Cambridge Bancorp reported unaudited net income of $3,733,000 for the first quarter of 2015 compared to $3,511,000 for the same quarter in 2014.
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The earnings increase of $222,000 (6.3%) was attributable to a combination of sustained growth in both net interest income and noninterest income offset by higher noninterest expense for the quarter ended March 31, 2015. Diluted earnings per share were $0.94 for the first quarter of 2015 versus $0.89 for the same period in 2014.
Net interest income for the quarter ended March 31, 2015 was $12.5 million compared to $11.8 million in the first quarter of 2014. The quarter-over-quarter net interest income increase of $681,000 (5.8%) was driven by continued loan growth in both the consumer and commercial sectors.
Interest on loans for the first quarter of 2015 was $10.8 million, an increase of $1.1 million (11.5%) compared to the same quarter in 2014.
This increase was offset by lower interest on taxable investment securities of $493,000 (24.2%) due to rates and volumes. The Bank’s overall net interest margin decreased by eight basis points to 3.28% for the quarter compared to 3.36% for the quarter ended March 31, 2014.
Noninterest income of $6.4 million for the March 2015 quarter was up $320,000 (5.3%) compared to the same quarter in 2014. The Bank continued to grow Wealth Management income, which increased $403,000 (9.6%) between the comparable periods, from new account growth and market appreciation.
Assets under management grew to $2.4 billion at the end of the first quarter 2015 from $2.3 billion at year-end 2014. There was a rebound in gains on loans held for sale, which increased from $25,000 to $120,000 quarter-over-quarter.
The increases in noninterest income were offset by a reduction in deposit account fees of $91,000 (14.4%), gains on disposition of investment securities of $70,000 (13.4%) and other income of $31,000 (13.0%) compared to the same period in 2014.
The Bank sustained the trend of growth in loans during the first quarter of 2015. Total loans outstanding increased by $17.1 million to $1.1 billion since year-end 2014 and by $150.7 million (15.9%) in comparison to March 31, 2014.
Non-performing loans as a percentage of total loans stood at 0.12% at March 31, 2015, down from 0.15% at December 31, 2014. Loan quality remains sound and the Allowance for Loan Losses stood at $14.6 million or 1.33% of total loans outstanding at March 31, 2015. At December 31, 2014, the Allowance for Loan Losses was $14.3 million or 1.33% of total loans outstanding.
In response to continued loan growth, the provision for loan losses was $325,000 for the current quarter.
Noninterest expense in the first quarter of 2015 totaled $13.0 million, an increase of $741,000 (6.0%) over the first quarter of 2014. The primary factor for the increase in noninterest expense was higher salaries and employee benefits of $679,000 (9.6%) as a result of growth in the workforce and costs of benefits packages as the Bank expands.
Total deposits increased by $14.5 million (1.1%) since year-end 2014, and increased by $80.0 million (6.1%) over March 31, 2014.
Total assets at March 31, 2015 were $1.6 billion, an increase of $37.2 million (2.4%) from year-end 2014. ■