Small and midsize Northeast regional banks reported solid third-quarter earnings, largely driven by active share repurchases and tight control of expenses.

Although consumer delinquencies were up and many banks took charges to help pay for refinancing the Savings Association Insurance Fund, analysts said these difficulties did not weigh heavily on balance sheets.

"The banking industry has been on a roll for over two years, characterized by widespread improving asset quality," said Gerard Cassidy, bank equity analyst at Tucker Anthony's Hancock Institutional Equity Services.

Mr. Cassidy said banks were also helped by moderate loan growth.

Analysts said banks are likely to spend less on insurance premiums in the future, saving money that could be spent on technology or product development.

Summit Bancorp

Summit Bancorp, Princeton, N.J., posted net income of $74 million, up 19% from the 1995 third quarter.

Excluding a $6.7 million charge for a payment to the SAIF, net income would have been $80.7 million, up 30%.

Return on assets was 1.45%, compared with 1.17% in the same period last year. Return on common equity was 17.54%; up 291 basis points.

Operating expenses were down at Summit, as the bank moved ahead of its schedule for taking out costs from its March merger with UJB Financial Corp.

As a result, Summit's efficiency ratio improved to 50.8%, from 55.7%.

GreenPoint Financial Corp.

New York City-based GreenPoint Financial Corp. reported $34 million of net income, up 13%.

The $13.4 billion-asset thrift holding company earned $98.6 million in the year's first nine months, up 12%.

Advest analyst Salvatore DiMartino credited GreenPoint's third-quarter success to strong loan growth, control of operating expenses, and the continuation of a stock buyback.

Loan originations for the quarter jumped to $707 million, a 31% increase from the second quarter. The loan portfolio grew 7.6% from June 30 to Sept. 30.

Astoria Financial Corp.

Astoria Financial Corp., Lake Success, N.Y., notched a net loss of $3.2 million for the quarter, but that was due primarily to a $16.9 million charge to cover a payment to the SAIF.

Excluding the one-time charge, Astoria Financial had net income of $13.7 million, a 20% gain. The thrift holding company's net was $23.2 million for the first nine months, a 32% drop.

However, analysts said stronger earnings from key revenues, tighter control over operating expenses, and a continued focus on return on equity brought operating earnings to 65 cents per share in the third quarter, 7 cents better than analysts' consensus estimate.

"The improvement came from sticking to the basic business, controlling credit risk, carefully managing their balance sheet, and maintaining its flexibility," said Mark Fitzgibbon, an analyst at Sandler O'Neill. "Their margin held up better than we anticipated.".

Peoples Heritage Financial

Peoples Heritage Financial Group Inc., Portland, Maine, earned $14.2 million, up 11%.

Without a one-time SAIF charge of $1.2 million, third-quarter net would have been $15.4 million.

"They have made successful acquisitions that are accretive," said Stanley Wells, an analyst at Keefe, Bruyette & Woods Inc.; "the progression of earnings is positive, and they expect to show a continued earnings momentum into 1997. Nothing in their financial statements shows that this will be interrupted."

Valley National Bancorp

Due to a $3.8 million charge for the SAIF assessment, Valley National Bancorp, Wayne, N.J., reported earnings dropped 20.6%, to $14.4 million.

However, profit at $4.6 billion-asset Valley was up 7% for the nine months ended Sept. 30, to $49.5 million.

The bank said it expects to earn back the SAIF charge in three years through lower projected deposit insurance premiums.

Valley is acquiring $405 million-asset Midland Bancorp, Paramus, N.J. That deal is expected to close in the first quarter.

Albank Financial Corp.

An SAIF charge of $6.4 million nicked profits at Albany, N.Y.-based Albank Financial, which declined 21.1%, to $17.2 million. Excluding the SAIF charge, Albank earned $23.6 million, up 4.8%.

Year-to-date, nonperforming assets as a percentage of the total rose 23 basis points, to 1.15%. Sour loans in the first nine months totaled $40.4 million, up 49% from the comparable period last year. Albank said the purchase of branches from two Rutland, Vt., banks was responsible for the uptick in nonperformers.

However, analysts said that wouldn't keep Albank, which has $3.5 billion of assets, from making more such acquisitions.

"Albank still has a good capital base," said Frank Barkocy, an analyst at Josephthal, Lyon, Ross Inc., "and the feeling is, for an independent institution, they will feel the need to make more moves in the New York markets or in Vermont again."

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