SunTrust Banks in Atlanta reported an improvement in quarterly earnings despite a steep decline in mortgage banking activity.
The $207 billion-asset company reported Friday that its net income rose 6% from a year earlier to $505 million. Earnings per share of $1.03 topped the mean of estimates compiled by FactSet Research Systems by 4 cents.
“We continued to realize benefits from our consistent focus on optimizing our business mix and investing in growth,” William Rogers, the company’s chairman and CEO, said in a press release.
Net interest income rose 15% to $1.3 billion. Total loans held for investment rose by 2% to $144 billion, while the net interest margin expanded by 15 basis points to 3.14%. The loan-loss provision fell by 38% to $90 million.
Direct consumer lending rose 21% to $8.2 billion; guaranteed student loans rose 18% to $6.5 billion. SunTrust also refrained from raising deposit rates.
Noninterest income fell 8% to $827 million. Income from mortgage originations fell 50% to $56 million. Investment banking and trading fees rose by double-digit percentage rates.
Noninterest expense rose 3% to $1.4 billion from costs related to the acquisition of Pillar & Cohen Financial and higher salaries and occupancy expense.