Aided by a recent acquisition and its investment in new branches, WSFS Financial Corp. in Wilmington, Del., reported a profit of $6.8 million, or 70 cents per share, in the third quarter, handily beating consensus analysts' estimates.
Even after excluding income from securities gains and resolution of certain tax-related items, Sandler O'Neill & Co. LP estimates that the $4.2 billion-asset WSFS earned 52 cents per share, six cents better than the average estimates of analysts polled by Thomson Reuters.
The company's third-quarter earnings topped second-quarter results by 27%, but were down 17% from last year's third quarter, when results were skewed by a one-time loss recovery.
In a news release Thursday, WSFS President and Chief Executive Officer Mark A. Turner attributed the earnings growth largely to "the investment we have made in our markets in response to the disruption and consolidation in the banking industry."
The company has opened five new branches since late 2010, which has led to modest increases in income from deposit service charges. Also late last WSFS year acquired Christiana Bank & Trust and that deal, its first in 15 years, helped the company nearly triple its income from trust-related services year-over-year, to nearly $3 million. In all, noninterest income, which accounts for nearly one-third of WSFS' revenues, jumped 17% year over year, to $16.9 million.
On the loan side, total commercial and industrial loans increased by nearly 18% year over year, to nearly $1.4 billion, though total loans remained relatively flat as the C&I gains were offset by declines in commercial real estate and construction lending. Still, net interest income increased 13% in the quarter from the same time last year, to $25.6 million, thanks largely to lower funding costs and a 24% reduction in its provision for loan losses.