Arrow Financial (AROW) in Glens Falls, N.Y., attributed a dip in third-quarter profits to the continued low interest rate environment.
The $2.2 billion-asset Arrow reported that income fell 2.2%, to $5.6 million, from a year earlier, the company said Monday. Its earnings per share of 46 cents beat the estimates of analysts polled by Bloomberg by 3 cents.
Arrow's net interest income fell 1.5%, to $14.1 million, while its net interest margin dropped 27 basis points, to 3.06%. The company attributed the decreases to current interest rates with yields on loans and interest-bearing assets hovering at historic lows.
Arrow's noninterest income climbed 1.5%, to $6.9 million, thanks to higher revenue from fees and fiduciary activities. Its noninterest expenses rose 1.6%, to $13.1 million, because of increases in occupancy expenses, FDIC assessments and other operating expenses.
The company also showed improvements in asset quality. It did not have a provision for loan losses in the third quarter, compared with a provision of $150,000 during the same period a year ago. Although the company did not provide information about net chargeoffs in the third quarter, it said that net loan losses as an annualized percentage of average loans outstanding were 0.03%.