Financial Institutions in Warsaw, N.Y., the parent company of Five Star Bank, reported higher earnings along with strong loan and deposit growth.

The $3 billion-asset company's profit increased 3% from a year earlier, to $7 million. It earned 48 cents per share.

Total loans increased 8.7%, to $1.9 billion, primarily on organic growth in commercial, home equity and consumer loans. Total deposits rose 5.1%, to $2.5 billion.

Net interest income increased 2.6%, to $23.1 million. However, the net interest margin was 3.47%, down 16 basis points from a year earlier.

Noninterest income increased 3.1%, to $6.6 million, thanks to $949,000 in gains from sales of investment securities.

Meanwhile noninterest expense rose 1.7%, to $17.8 million, on costs related to Financial's pending acquisition of an insurance firm, Scott Danahy Naylon Co., and the hiring of employees.

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