HALLSTEAD, Pa. — Peoples Financial Services Corp. (Ticker: PFIS) recently reported that its profit in the fourth quarter fell from a year ago. But that didn’t prevent the banking company from boosting annual net income to a new record.
For the fourth quarter, Peoples generated net income of $1.8 million, or 57 cents per share, down from just over $2 million, or 65 cents, in the fourth quarter of 2010.
For the full year, Peoples produced net income of $7.8 million, or $2.49 a share, up more than 20 percent from $6.5 million, or $2.07 per share, in 2010.
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“I am extremely pleased with our company’s performance in 2011,” President and CEO Alan W. Dakey said in a news release.
“We achieved record earnings and exceeded our goals for profitability and asset growth. Despite a very challenging interest rate and competitive environment, our net interest margin increased, which was the driving force behind the earnings improvement. We look forward to continued financial strength in 2012 as the economy continues to improve.”
Peoples Financial Services is the parent company of Peoples Neighborhood Bank, which has local offices in Binghamton, Conklin, and Deposit. The company’s stock price closed at $27.50 per share on Jan. 20, the day the company released its earnings. The share price opened at $28.15 on the next trading day (Jan. 23), before finishing at $28.
Tax-equivalent net interest income at Peoples increased 12.6 percent to $23.3 million in 2011, up from $20.7 million a year ago. The increase is the result of a $1.7 million increase in tax-equivalent interest revenue coupled with a $900,000 reduction in interest expense.
Noninterest revenue rose 29.8 percent to $5.6 million for the year, up from $4.3 million. The company’s wealth-management division provided a $352,000 revenue boost from the acquisition of an investment-advisory business in the fourth quarter. The company also realized a $1.7 million gain on the sale of a commercial property. Services charges, fees, and commissions declined $487,000, while mortgage-banking income decreased $71,000.
Noninterest expense increased $2.1 million to $15.2 million, including $937,000 in payroll increases and a $378,000 increase in occupancy and equipment expenses related to flooding in four branch offices.
Peoples’ provision for loan losses was $1.8 million, down from $2.2 million in 2010.
Total assets increased 11.2 percent to $621.4 million as of the end of 2011, as total deposits grew 12.7 percent to $494.3 million. Loans increased 13.9 percent to $445.1 million, while available-for-sale investment securities rose 14.9 percent to $139.9 million. Nonperforming assets equaled $9 million, or 2.02 percent of loans.
The company declared a fourth-quarter dividend of 20 cents per share and a full-year dividend of 80 cents per share.
Peoples Financial Services Corp. (www.peoplesnatbank.com) operates 11 branches of Peoples Neighborhood Bank in Lackawanna, Wyoming, and Susquehanna counties in Pennsylvania along with Broome County in New York. Peoples Wealth Management is a member-managed, limited liability company that provides investment advisory services to the general public.
