First Republic Bank in San Francisco rode double-digit loan and fee-income growth to a strong first quarter.
The $62.1 billion-asset company on Thursday reported profits of $149 million, a 28% increase from a year earlier. Earnings per share were 88 cents, which beat analysts' consensus estimate by 8 cents.
The growth partly reflects its efforts to build its wealth management operations, including the purchase of Constellation Wealth Advisors in October.
Fee income increased 27.1% to $95.3 million. Within that, wealth management revenues rose 31.4% to $68.9 million. Wealth management assets also rose 30.3% $73.4 billion, including roughly $5.9 billion in assets under management acquired with Constellation.
Meanwhile, total loans rose 16% to $45.1 billion. Originations in single-family, multifamily, home equity lines of credit and unsecured loans all rose.
Net interest income soared 21.9% to $424.3 million thanks to the loan growth and fatter margins. The net interest margin expanded 10 basis points to 3.20%.
But some of the expansion efforts added costs. Noninterest expenses grew 24.8% to $319.2 million, mainly on an increase in salaries and employee benefits.