VSB Bancorp Inc. said Wednesday that second-quarter earnings fell 7.5% largely because of lower yields on securities and loans during the period.
The Staten Island, N.Y., banking company reported preliminary net income of $427,704, down more than $34,600 from a year earlier. Net interest income fell faster than the decline in its funding costs.
Though average balances were higher for loans and securities, more nonperforming loans stopped paying interest, VSB said.
The second quarter "demonstrated that the general economic recovery appears to be slowing due to increased oil prices and high unemployment," VSB's president and chief executive, Raffaele Branca, said in a press release. "Our nonperforming loans increased by $2.5 million in this quarter, but we are working toward a positive resolution with two of the largest borrowers."
Interest income from investment securities fell $126,145, and interest from loans dropped $85,000. The average yield on securities fell by 63 basis points, and the average yield on loans fell by 66 basis points.
VSB had $244.9 million in assets at June 30 and is the parent of Victory Savings Bank.