City Holding Co. (CHCO) in Charleston, W.Va., reported a 32% increase in quarterly profit as acquisitions helped boost its interest income.
The $3.4 billion-asset company earned $14 million in the third quarter, up from $10.6 million in the same period in 2012, it announced Wednesday. Earnings per share of 88 cents were 12 cents higher than analysts polled by Bloomberg.
City Holdings' net interest income increased by 30%, to $32.4 million, as its net interest margin widened by 52 basis points, to 4.47%. Its loan portfolio grew by 23%, to $2.5 billion, aided by two recent acquisitions. It closed its deal for Community Financial Corp., in Staunton, Va., in the first quarter of the year and its purchase of Virginia Savings Bank in Front Royal, Va., last year. The two deals added more than $600 million to City Holdings' total assets.
City Holdings made a $1.2 million provision for loan losses, up from $975,000, and its net chargeoffs were $617,000, down from $1.4 million.
The bank's noninterest income rose 7%, to $14.5 million, as service charges and card revenue ticked up. Noninterest expenses increased by 13%, to $24.7 million, on higher compensation costs. City Holdings attributed the added costs mainly to the Community Financial acquisition.
Last month, City Holding said it would close one of the Virginia branches it acquired in the Community Financial acquisition because of the branch's poor deposit mix.