DeWITT — Net income at Beacon Federal Bancorp, Inc. (NASDAQ: BFED) plummeted almost 61 percent in the second quarter that ended June 30. The banking company, which is based in DeWitt and in the process of being acquired by a larger bank, posted a profit of $666,000, or 11 cents per share. That’s down from […]
DeWITT — Net income at Beacon Federal Bancorp, Inc. (NASDAQ: BFED) plummeted almost 61 percent in the second quarter that ended June 30.
The banking company, which is based in DeWitt and in the process of being acquired by a larger bank, posted a profit of $666,000, or 11 cents per share. That’s down from $1.7 million, or 28 cents a share, in the same period last year.
“Due in part to the continuing strained economic conditions in our markets combined with the slowing of commercial lending opportunities, earnings results were not as strong as projected,” Beacon President and CEO Ross J. Prossner said in a news release. “We continue to improve our cost of funds, and beginning in June, a portion of our high-priced borrowings matured.”
Beacon’s total assets fell by $28.9 million to $998 million as of June 30. A $41.3 million decrease in net loans and $9.9 million decline in cash and cash equivalents drove the decline. It was partially offset by a $21.2 million increase in securities.
Beacon Federal has branches in DeWitt, East Syracuse, Marcy, and Rome; Smartt and Smyrna, Tenn.; and Chelmsford, Mass.
The earnings report comes after Berkshire Hills Bancorp., Inc. (NASDAQ: BHLB), which is the Massachusetts–based parent of Berkshire Bank, announced plans in May to acquire Beacon Federal in a $132 million deal. The banking companies expect that transaction to close in the fourth quarter of this year.
In July, the federal Office of the Comptroller of the Currency reported finding unsafe banking practices at Beacon Federal. The bank agreed to implement a three-year business plan and review the qualifications of all senior executive officers on the path to correcting the practices, which were related to asset quality and risk management. The bank also agreed to establish new risk-management practices, diversify its assets, improve internal controls on commercial lending activities, and review and revise its loan policy. Beacon Federal and Berkshire Hills both said the matter would have no impact on their merger deal.
Contact Seltzer at rseltzer@cnybj.com
