Hudson Valley Holding (HVB) in Yonkers, N.Y., reported lower second-quarter earnings after net interest income dropped from the same period a year earlier.
Second-quarter profit declined 32%, to $5 million, from a year earlier, the $2.8 billion-asset company said Wednesday. Earnings per share of 25 cents fell short of analysts' estimates by two cents, according to Thomson Reuters.
The decrease in income was mostly due to a decline in net interest income, which was the result of excess liquidity remaining from the proceeds of loan sales in the first and second quarters. Hudson Valley completed the sale of $474 million in loans after the Office of the Comptroller of the Currency told it to reduce its concentrations in commercial real estate and classified loans, the company said in April.
Net interest income was $25.5 million, down almost 14% from a year earlier.
Hudson Valley has increased its emphasis on commercial and industrial loans, which led to a 2% jump in such loans, to $231.1 million, from a year earlier. The company continued to shrink its CRE portfolio, which fell 25%, to $634 million, from a year earlier. Total loans dropped roughly 19%, to $1.6 billion.
Hudson Valley's provision for loan losses climbed almost 36%, to $1.9 million, from a year earlier. Nonperforming assets rose more than 36%, to $39.6 million from the prior quarter but were down more than 38% from the same period a year earlier. The linked quarter increase reflected some delinquent loans moving to nonaccrual status, including a $13.1 million relationship that has a workout plan in place.