Profit slipped at Cullen/Frost Bankers (CFR) in San Antonio as expenses rose last quarter.
The $22.6 billion-asset company reported Wednesday that it earned $57 million in the second quarter, down 2% from a year earlier. Per-share earnings of 94 cents fell 1 cent short of the average estimate of analysts polled by Bloomberg.
Net interest income rose 3%, to $153.2 million, as interest-bearing assets increased. Cullen/Frost's net interest margin declined by 18 basis points, to 3.43%.
Noninterest income increased 4%, to $72.5 million, as trust and management fees ticked up 6%, to $22.6 million. Income from the sale of mutual funds also contributed to the rise in noninterest income.
But noninterest expense rose 5%, to $149.8 million, as compensation increased by 5%, to $149.8 million. Furniture and equipment costs rose by $1.9 million, and marketing costs increased by just under $1 million due to a mobile banking promotion.
Provision for loan losses rose 50%, to $3.6 million, and net chargeoffs fell 3%, to $3.8 million.