PROVIDENCE – Rising interest rates helped boost Independent Bank Corp.’s earnings to $61.8 million for the quarter that ended June 30, the company reported on Thursday.
The latest earnings for the Rockland Trust Co. parent company mark a 64.4% increase over a year ago, thanks in part to interest rate hikes boosting the interest income collected on investments.
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The latest earnings report also reflects growth from the $1.2 billion acquisition of Boston-based Meridian Bancorp, which closed in November.
Earnings per diluted share rose 18 cents to $1.32.
Interest income jumped 53.2% year over year to $148.1 million.
While interest rate hikes often also increase interest-related expenses for financial institutions, the company saw its quarterly interest expenses drop by 2.8% to $3.3 million, in part due to fewer fees tied to the elimination of Paycheck Protection Program, the company stated.
Net interest margin – the difference between interest income generated and the amount of interest paid out to lenders – increased 28 basis points to 3.27%.
The company also did not move the needle on its loan loss reserves, neither adding to nor dumping money from its stockpile. By comparison, the company released $5 million in credit loss provisions in the second quarter of 2021, mirroring actions taken by financial institutions nationwide as fears of pandemic-induced loan defaults subsided.
Non-interest income of $27.9 million marked an 11.7% increase over a year ago, driven by gains in deposit account and interchange and ATM fees from increased transaction volume, the company stated.
Non-interest expenses were up 23.56% to $90.6 million, including a 1.7% bump in employee salaries and benefits and a 14.3% increase in “other” expenses.
Quarterly assets stood at $20.0 billion, a 40.8% rise over a year ago, which included $13.7 billion in loans. The 53% increase in quarterly loans was driven by commercial construction, commercial real estate and residential real estate loans.
Total deposits of $16.6 billion marked a 38.8% increase, with growth across all types of deposits.
While based in Rockland, Mass., Rockland Trust operates a commercial lending and investment office in Providence, and has bank branches in Seekonk and Attleboro.
“We generated solid results while continuing our focus on disciplined growth,” Christopher Oddleifson, CEO of Independent Bank Corp. and Rockland Trust Co., said in a statement. “Our core fundamentals were on full display this quarter as evidenced by revenue and loan growth along with a continuing sound balance sheet.”
Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.
