Union First Market Bankshares' acquisition of StellarOne paid dividends in the second quarter.
The Richmond, Va., company reported a profit of $14.8 million, up 56% from a year earlier. Earnings per share of 32 cents beat analysts' estimates by four cents, according to Bloomberg.
Net interest income rose 70%, to $63.7 million, as the StellarOne acquisition in January added $2.3 billion in loans.
Noninterest income increased 48%, to $16.7 million, primarily because of increases in service charges on deposit accounts, debit card interchange income, letter of credit fees and income from wealth management services. The StellarOne acquisition added $2.5 billion in deposits.
Union First paid about $445 million for StellarOne, which was based in Charlottesville, Va.
Also in the second quarter, total mortgage loan origination activity fell 35%, to $195.1 million. The drop-off was highlighted by refinancing business falling 58%, to $47.6 million, while purchase volume declined 28%, to $108 million.
Noninterest expenses rose 73%, to $59.5 million, sparked by $3.7 million in acquisition costs and an additional $10 million in salaries and benefits. Furthermore, professional service fees, occupancy costs, and other-real-estate-owned and credit-related expenses all increased.
Union First had a $1.5 million loan-loss provision in the second quarter, compared with a $1 million provision in the year-earlier period. The higher provision stemmed from increases in specific reserves on impaired loans.
Net chargeoffs were $1 million, compared with $1.1 million a year earlier.