Core earnings at Pittsfield-based Berkshire Hills Bancorp declined on a year-over-year basis to $10.4 million for the quarter ended March 31, driven largely by branch acquisition costs and lower income on real estate related loans resulting from interest rate related market shifts last year.
For the quarter ended March 31 of last year, the holding company for Berkshire Bank posted $13.5 million in core earnings.
In January, Berkshire also completed its acquisition of 20 Bank of America branches in Central New York, which increased the bank’s footprint to 90 full-service offices across Massachusetts, New York, Connecticut and Vermont.
"We started the year with solid growth," CEO Michael Daly said in a statement. "Commercial loans increased at a near double-digit annualized rate, as our lending teams continue to garner market share and new relationships across our footprint. We opened a new branch office in Loudonville, N.Y. and continued to develop our consumer deposit and loan business. Our insurance and wealth management revenues improved, and we are extending our reach in newer markets."
Berkshire increased its total assets $338 million, or 6 percent, mostly due to growth in loans and investment securities.
Total loans increased $62 million, or 6 percent annualized, including 9 percent annualized commercial loan growth and 11 percent annualized consumer loan growth. In a statement, the company noted strong commercial loan originations in Berkshire County and Central and Eastern Massachusetts. Consumer loan growth was primarily auto loans originated by Berkshire’s Syracuse-based lending team.
Fee income declined 12 percent, or $1.8 million, from the first quarter of 2013. Revenue from mortgage banking and loan related fee income decreased from elevated levels last year due to the midyear increase in interest rates in 2013.
Wealth management fees increased by 13 percent over the first quarter of 2013 due to account growth and improved market conditions. Wealth management generated new business at a 9 percent annualized rate in the most recent quarter, and the portfolio totaled $1.3 billion at quarter-end. Insurance fees increased by 2 percent over this period.
The provision for loan losses totaled $3.4 million, continuing its gradual increasing trend as loan volume has increased and acquired loans season. Net charge-offs totaled $3.1 million during the quarter. The provision totaled $3.1 million in the prior quarter and $2.4 million in the first quarter of 2013.
Non-interest expenses in the first quarter totaled $45.4 million. That line item included seasonally higher benefits and maintenance expenses, in addition to merger and conversion costs.
The board of directors declared a cash dividend of 13 cents per share to be paid on May 29 to shareholders of record on May 15.
