First Interstate Reports Higher Profit on Loan Growth

First Interstate BancSystem in Billings, Mont., reported higher quarterly profit tied to loan growth and increased fee income.

The $8.6 billion-asset company said in a press release Tuesday that net income increased 15% from a year earlier to $25.6 million, or 57 cents a share.

Net interest income increased 3.6% to $67.6 million. Total loans increased 6.1% to $5.4 billion; the company touted increases in all categories except for agricultural loans. Total deposits increased by 2.6% to $6.9 billion. The net interest margin widened by 15 basis points to 3.55%.

The loan-loss provision nearly doubled to $2.5 million. The company had $2.1 million in net chargeoffs in the quarter, which represented a big increase from the $124,000 it recorded a year earlier.

Noninterest income rose 16.5% to $37 million, with increases in payment services, mortgage banking and wealth management. Service charges also increased.

Meanwhile, noninterest expenses increased by 1.5% to $62.8 million, largely because of higher costs tied to salary and wages.

The company in April agreed to buy $231.6 million-asset Flathead Bank of Bigfork in Montana for $34.2 million in cash. The deal is expected to close during the third quarter.