Sterling Financial (STSA) said after markets closed Wednesday that its first-quarter net income rose 146% from the same period last year, to $13.3 million, due primarily to a growth in loan balances, lower funding costs and improved asset quality.
Its earnings declined 10% from the prior quarter, however, due to costs related to recent staff cuts and branch closures and its acquisition of First Independent Bank of Vancouver, Wash.
Earnings per share more than doubled year over year, to 21 cents, but were down 3 cents from the prior quarter. Analysts polled by Thomson Reuters had projected earnings of 28 cents per share.
Greg Seibly, Sterling's president and chief executive officer, said that a highlight for the quarter was a 31% increase in portfolio loan originations year over year, $347.5 million. Much of that growth was in the multi-family, consumer and commercial and industrial portfolios. Overall, loan balances climbed 8% year over year, to $6 billion, including loans it inherited from First Independent.
With interest rates still low, the $9.5 billion-asset company said it reduced its funding costs by 34 basis points, to 0.67%. That helped boost the net interest margin by 16 basis points, to 3.38%.
Nonperforming assets declined by $279 million, or 44%, from the prior year, and $19 million, or 5%, from the previous quarter.