Webster Financial (WBS) in Waterbury, Conn., reported higher third-quarter profit as commercial loan growth made up for a steep decline in mortgage-banking revenue.
The $20.6 billion-asset company earned $44.7 million in the third quarter, up less than 1% from the same period in 2012, Webster said Friday. Its earnings per share of 49 cents met the average estimate of analysts polled by Bloomberg.
Webster's net interest income rose 4%, to $150 million. Its loan portfolio grew by 6%, to $12.5 billion, led by a 14% increase in commercial and commercial real estate loans. Its net interest margin declined by 5 basis points, to 3.23%.
Webster's noninterest income fell 5%, to $46.3 million, as its mortgage pipeline dried up. Mortgage revenue fell to $665,000 from $6.5 million, but rising income from fees on loans and deposit accounts partially made up for the loss.
Webster reduced its overhead by 2%, to $120.8 million, as compensation, occupancy and technology costs ticked down.
Webster's provision for loan losses rose to $8.5 million from $5 million, and net chargeoffs dropped 19%, to $14.4 million.
Warburg Pincus sold its stake in Webster earlier this year, earning about $208 million from the sale. It owned nearly 24% of the company before gradually reducing its holdings through a series of sales.
Gerald Plush, Webster's president and chief operating officer, announced last month that he would step down. The company has not named a replacement.