DeWITT — Loan growth helped push profit up more than 17 percent in the second quarter at DeWitt–based Community Bank System, Inc. (NYSE: CBU) Net income at the banking company totaled $21.1 million, or 53 cents a share, for the period, up from $18 million, or 49 cents a share, a year earlier. Total loans […]
DeWITT — Loan growth helped push profit up more than 17 percent in the second quarter at DeWitt–based Community Bank System, Inc. (NYSE: CBU)
Net income at the banking company totaled $21.1 million, or 53 cents a share, for the period, up from $18 million, or 49 cents a share, a year earlier. Total loans increased $100.9 million from the first quarter to $3.56 billion.
Loans totaled $3.48 billion at the end of the second quarter in 2011.
Loans increased in all categories, Community Bank CFO Scott Kingsley said during a July 25 conference call on the bank’s second-quarter results.
Consumers were the main spark for the loan growth, President and CEO Mark Tryniski added. Only about $16 million of the loan increase was related to business lending and much of that was driven by enterprise-level customers, he said.
The bank has yet to see much demand for credit from small businesses, Tryniski said. He also said Community expects strong loan growth in the months ahead.
“The consumer opportunities in our markets are strong,” he said. “We expect a continuation of solid mortgage growth into the third quarter.”
The bank’s pipeline of new commercial loans is strong as well, he noted. The loan growth in the second quarter included a mix of business from existing customers and new relationships, Tryniski said.
Community Bank has $7.5 billion in assets and 190 branches in upstate New York and northeastern Pennsylvania. The company also operates subsidiaries in employee benefits, insurance, investment management and advising, and wealth management.
Net interest income for the second quarter rose 6.6 percent from a year earlier to $57.8 million. Noninterest income was $23.7 million, up from $22.8 million in the second quarter of 2011. That increase was helped by last year’s acquisition of CAI Benefits, based in the New York City area, by Community’s employee-benefits subsidiary.
The acquisition contributed to a 10.3 percent increase in employee-benefits revenue.
Noninterest income was also helped by an increase of 11.5 percent in wealth-management fees, driven by gains in trust services and asset management, according to Community.
Also during the second quarter, Community Bank closed an acquisition of 16 HSBC branches across Western, Central, and Northern New York. The bank will pick up three more First Niagara Bank branches in Geneva and Canandaigua in September.
Total deposits increased to $4.91 billion at the end of the quarter, up from $4.76 billion a year earlier.
Operating expenses for the second quarter totaled $49.4 million, down from $51.1 million a year earlier. Last year’s second quarter included more than $3.6 million in acquisition costs, compared with $164,000 this year.
Net charge-offs in the second quarter totaled $2.1 million, up from $2 million in the first quarter this year and $700,000 a year earlier. The provision for loan losses was $2.2 million, up $500,000 from the first quarter and $1.1 million higher than the second quarter of 2011.
Nonperforming loans totaled $32 million at the end of the second quarter, down from $34 million in the first quarter and up from $20.3 million a year earlier.