First quarter net income at the Bridgeport, Conn.-based People’s United Financial increased more than 11 percent year-over-year, boosted by expense management and higher non-interest income.
Net income for the quarter ended March 31 totaled $59.2 million, compared with $53.1 million in the same period last year. That boosted earnings to 20 cents per share, from 18 cents per share a year ago. Operating earnings totaled $63.2 million, or 21 cents per share, representing an increase of about 12 percent over $56.5 million, or 19 cents per share, in the first quarter last year.
“Our performance this quarter is an encouraging start to the year, especially given the persistent low interest rate environment as well as the severe winter weather across our markets,” President and CEO Jack Barnes said in a statement. “While the first quarter is typically a seasonally slower period, we achieved solid annualized loan growth of five percent and the success of our deposit gathering initiatives drove annualized organic deposit growth of over 17 percent.”
Non-interest income climbed about 2.5 percent to $89 million, from $86.8 million in the last quarter of 2014. While commercial banking lending fees, net gains on sales of acquired loans, insurance revenue and customer interest rate swap income increased, bank service charges and net security gains declined.
Net interest income remained flat over that same period, totaling $228.1 million in both the first quarter of 2015 and the last quarter of 2014.
Non-interest expenses ticked up slightly, from $207.7 million in the fourth quarter to $217.6 million in the first this year. That increase was driven largely by a $6.6 million increase in compensation and benefits, followed by a $2.4 million increase in occupancy and equipment expenses and a $1.1 million increase in professional services expenses. The company increased its efficiency ratio to 61.9 percent from 61.3 percent in the last quarter of 2014.
Commercial loans increased $238 million, or 5 percent on an annualized basis, from the year-end 2014, and commercial deposits totaled $7.8 billion, compared with $7.2 billion at the year’s end. Residential mortgage loans increased $119 million, or 10 percent annualized, from Dec. 31. Retail deposits ticked up to $16.7 billion from $16.3 billion at the end of the year.
As of March 31, the company’s common equity tier 1 capital and total risk-based capital ratios stood at 10 percent and 12 percent, respectively, and its tangible equity ratio stood at 7.5 percent. People’s United Bank common equity tier 1 capital and total risk-based capital ratios were 10.6 percent and 13.0 percent, respectively.
Net loan charge-offs as a percentage of average total loans on an annualized basis were 0.11 percent in the first quarter of 2015, compared with 0.13 percent in the fourth quarter of 2014 and 0.12 percent in the first quarter of 2014. For the originated loan portfolio, non-performing loans equaled 0.68 percent of loans as of March 31, compared with 0.77 percent at year-end 2014 and 0.84 percent a year ago.
Total assets increased to $36.4 billion from $33 billion a year ago.
