An increase in fee income fueled StellarOne (STEL) in Charlottesville, Va., in the fourth quarter.
Earnings at the $2.9 billion-asset company rose 63% from a year earlier, to $6.2 million. Earnings per share of 27 cents were 3 cents a share above the average analysts' estimate, according to Bloomberg.
Noninterest income rose 13.3% from a year earlier, to $9.4 million because of fees from fiduciary and brokerage services and revenue from bank-owned life insurance. Noninterest expense fell 1.6%, year over year, to $24 million.
Net interest income was $24.2 million, roughly unchanged from the fourth quarter of 2011. The net interest margin fell 4 basis points from a year earlier, to 3.75%.
StellarOne's efficiency ratio improved to 68.25% from 71.84% in the fourth quarter of 2011.
It booked loans of $2 billion in the fourth quarter, roughly unchanged from a year earlier. The allowance for loan losses fell 7.8% from a year earlier, to $30 million.
"We achieved significantly improved profitability in large part due to asset quality improvement, but also saw noninterest income grow 10.6% annually led by our mortgage line of business, with solid contributions from commercial and retail banking as well as wealth management," O. R. Barham, Jr., StellarOne's chief executive, said in a press release.