First Citizens in N.C. Reports Higher Profit on Improved Asset Quality

First Citizens BancShares (FCNCA) in Raleigh, N.C., reported higher third-quarter profit because of a significant improvement in credit quality.

The $21.5 billion-asset company's earnings rose 4% from a year earlier, to $41 million. First Citizens' recorded a $7.7 million credit to its loan-loss allowance, compared to a $17.6 million provision a year earlier. The company said it was able to draw down its allowance after it had unexpected payoffs on acquired loans. Net chargeoffs fell 9% from a year earlier, to $12.8 million.

Net interest income fell 17% from the third quarter of last year, to $36.2 million, because of less income from acquired loans. Noninterest income rose 39% from a year earlier, to $71.9 million, aided by a $1.7 million increase in merchant services income.

Noninterest expenses ticked up 1% from a year earlier, to $192 million, because of higher employee benefits and expenses for consulting and advertising.

First Citizens completed six FDIC-assisted bank acquisitions between 2009 and 2011. The company agreed to pay $10 million in cash to buy 1st Financial Services in Hendersonville, N.C. in August.