ECB Bancorp (ECBE) in Engelhard, N.C., became a more-attractive seller after posting higher quarterly earnings.
ECB’s earnings more than tripled from a year earlier, to $1.6 million, because of higher noninterest income and lower funding costs. The company agreed last month to sell to Crescent Financial Bancshares in Raleigh, N.C., a deal that should close in the fourth quarter. Crescent also reported its results Tuesday, posting a narrow loss after taking into account dividends on its preferred stock.
ECB’s noninterest income more than doubled from a year earlier, to $5.2 million, largely because of securities gains. Those gains helped offset lower interest income and a spike in its loan-loss provision, compared with a year earlier.
The $927.6 million-asset company’s net interest margin expanded by 9 basis points from the second quarter and 26 basis points from a year earlier, to 3.32%.
“The economy of our coastal markets in North Carolina have strengthened due to a good tourist season with many of our business clients reporting positive” earnings, A. Dwight Utz, ECB’s president and chief executive, said in a press release. “While some markets in our footprint are still experiencing some economic weakness, many appear to be stabilizing.”
ECB remains well-capitalized but has some remaining credit quality issues remaining. Nonperforming loans as a percentage of total loans increased 15 basis points from a year earlier, to 5.64%.