People's United reports higher profit that reflects recent acquisitions
People’s United Bancorp in Bridgeport, Conn., reported higher quarterly earnings that reflected gains from recent acquisitions.
The $44 billion-asset company said in a press release Thursday that its third-quarter profit rose 23% from a year earlier, to $90.8 million. Revenue increased 11% to $374 million.
People’s has acquired a number of businesses in the last year, including an equipment-finance company, an investment firm and the $2.3 billion-asset Suffolk Bancorp in Riverhead, N.Y.
“The positive operating trends in the quarter reflect specific actions we have taken to enhance financial performance,” Jack Barnes, the company’s president and CEO, said in the release. “We have recently closed three successful acquisitions, made various investments in organic growth capabilities and maintained tight control of expenses.”
Net interest income rose 16% to $285 million.
Total loans rose 11% to $32.4 billion, while the net interest margin expanded by 24 basis points, to 3.04%. It is the company’s highest margin in three years, and Barnes said he expects solid loan growth in the fourth quarter due to strong pipelines for commercial real estate and commercial-and-industrial loans.
Deposits rose by 7% to $38.2 billion.
Noninterest expenses rose 7% to $237 million. Still, the company was able to lower its efficiency ratio to 57.3% in the third quarter from 59.9% a year earlier.
Although nonperforming loans and net chargeoffs rose modestly, they remained at very low levels. Nonperforming assets totaled $174 million at Sept. 30, or 0.59% of total loans, excluding assets obtained in recent acquisitions. Net chargeoffs were equal to 0.06% of total loans.
People’s is nearing the $50 billion-asset threshold where it would become a systemically important financial institution. The company said many of the costs associated with crossing the threshold have been absorbed.