WILLIMANTIC — SI Financial Group Inc., the holding company of Savings Institute Bank and Trust Company, reported net income of $2.8 million in the second quarter, or 24 cents per diluted share, compared with $1.7 million, or 15 cents per share, for the same period in 2016.
Contributing to the higher earnings was a pretax gain of $795,000 on the sale of the company’s trust and asset management business in May 2017.
Net interest income for the quarter ending June 30 increased $525,000 to $10.7 million, the company reported Thursday. It cited higher average loan balances and higher average yields on other interest-earning assets. Noninterest income, which included the asset sale, increased $1.1 million to $3.6 million.
Noninterest expenses increased $443,000, to $10 million, primarily due to an increase in salaries and benefits of $582,000, the company said. It also noted that “fraudulent debit card transactions of $373,000” were a factor in a six-month increase in non-interest costs, compared with 2016, but said that non-interest expenses in the latest quarter raised decreased $103,000.
SI Financial also indicated that it was winding down costs related to its September 2013 acquisition of Newport Federal Savings Bank, citing a decline of $221,000 in outside professional services for the first half of 2017 “due to decreases in legal and audit fees and consulting expenses related to non-compete agreements.”
Total assets increased $45.6 million, or 2.9 percent, to $1.60 billion, in the first half, and deposits amounted to $1.2 billion, compared with $1.1 billion at the end of December 2016. Net receivable loans totaled $1.2 billion, up $7.4 million in the first six months of 2017.
The higher balance of net loans receivable reflects increases of $27 million in multifamily and commercial real estate loans and $13.4 million in other commercial business loans, offset by decreases of $13.7 million in SBA and USDA guaranteed loans, $10.2 million in construction loans and $8.3 million in residential mortgage loans. Commercial business and residential real estate loan originations increased $21.4 million and $10.1 million, respectively, while commercial real estate loan originations decreased $3.8 million during the first half of 2017 compared to the same period in 2016.
The Willimantic-based company, which operates 24 branches in Connecticut and Rhode Island, said that its deposit growth remained strong “due to marketing and promotional initiatives and competitively-priced deposit products.”
Rheo A. Brouillard, president and CEO said. “Results for the quarter and year to date continue to reflect our efforts to restructure the balance sheet and improve asset quality and overall performance. Strong deposit growth has allowed us to fund growth in loans and securities while reducing borrowings.”