Virginia Commerce Bancorp Inc. in Arlington said late Wednesday that its third-quarter earnings rose 12.2% from a year earlier, to $6.8 million, because of loan growth and improved credit quality.
Earnings per share rose 8%, to 27 cents.
The parent company of the $2.2 billion-asset Virginia Commerce Bank reported a $252,000 after-tax net loss from a partial restructuring of its investment securities portfolio, as well as a $415,000 after-tax gain from the sale of a foreclosed property that had secured a nonperforming loan.
Increases in loans (17.6%) and deposits (12.2%) helped offset a 43-basis-point decline in the net interest margin, to 3.58%.
"Our loan growth is not only indicative of the ongoing strength of our loan pipeline, but also is particularly satisfying in the face of higher portfolio runoff," Peter A. Converse, Virginia Commerce Bancorp's chief executive officer, said in a press release. "Furthermore, despite nationwide concerns about asset quality deterioration in the banking industry, we realized a significant reduction in nonperforming loans."
Nonperforming assets and loans past due by 90 days or more dropped 76% from a year earlier and 49.7% from the previous quarter, to $1.9 million. The provision for loan losses decreased 36% from a year earlier, to $910,000.
Virginia Commerce said it opened two branches in the quarter, in Fredericksburg and Centreville, bringing its total to 23. It also plans to open one next month.
Still, Mr. Converse said the efficiency level should not exceed the high 40s. The ratio was 47.6% for the quarter, slightly worse than its 44.9% ratio a year earlier.
