Berkshire Hills Bancorp in Boston reported higher quarterly profit that reflected strong loan growth.
The $12.2 billion-asset company said in a press release Wednesday that it earned $14.3 million in the fourth quarter. A year earlier, Berkshire reported a fourth-quarter loss of $2.8 million that included a large charge associated with federal tax reform.
Net interest income increased by 8%, to $93.4 million. Total loans rose by 9%, to $9 billion, while the net interest margin narrowed by 9 basis points, to 3.41%. Deposits increased by 2.7%, to $9 billion.
Berkshire had a 101% loan-to-deposit ratio on Dec. 31. A year earlier, that ratio was 95%.
The loan-loss provision increased by 9.4%, to $6.7 million.
Noninterest income fell by 28% to $21 million, including a 50% decline in mortgage revenue and $3 million in securities losses.
Berkshire said fee income also took a hit after it was unable to process some SBA loans as a result of the partial federal government shutdown.
Noninterest expense rose slightly, to $90.2 million, which included higher professional services costs and $3 million in merger-related expenses. The company also reported $8 million in charges tied to a vendor system restructuring and $1.5 million in expense associated with a CEO transition that took place in November.
Richard Marotta succeeded Mike Daly as CEO.
Berkshire’s efficiency ratio worsened: It was 60.3%, versus 57.43% a year earlier.
“During 2018, our teams made great strides integrating our eastern Massachusetts acquisition and developing organic business across our footprint,” Marotta said in the release.
“Loan growth was consistent throughout the year, and deposit balances increased with the benefit of higher activity in the fourth quarter,” Marotta added. “Our internal capital generation supported our balance sheet growth, and our credit performance and asset quality remain strong."
