People's United Financial reported results for the second quarter of 2021.
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We are pleased with the overwhelming shareholder approval received during the quarter for the announced merger with M&T," said Jack Barnes, Chairman and Chief Executive Officer.
"The vote reflects investor confidence in the value of merging two market-leading financial institutions, and in the ability of the combined company to better serve clients across some of the most populated and attractive banking markets in the nation.
"While preparations for the transaction's close and integration move forward, our most important objective remains servicing the needs of customers, communities, and colleagues. Looking to the future, we are excited about executing on the growth opportunities ahead and building upon the extraordinary legacy of People's United."
"We delivered another quarter of strong financial performance," stated David Rosato, Senior Executive Vice President and Chief Financial Officer. "Record quarterly operating income of $176.1 million, increased 12.5 percent linked-quarter and generated an operating return on average tangible equity of 15.4 percent.
"These results, which further highlight the strengths of the franchise, included higher fee revenues, well-controlled expenses, and a negative provision for credit losses primarily driven by further improvements in the economic outlook.
"The growth in fee revenues was broad-based with notable increases in swap income, and our wealth and cash management businesses. We are pleased with our ability to hold net interest margin relatively steady for the quarter considering the current economic environment.
"The margin of 2.70 percent was only four basis points below the first quarter as the unfavorable impact of lower yields in the securities portfolio and increased excess liquidity was largely offset by a reduction in deposit costs for the eighth consecutive quarter, an additional calendar day and continued stable loan yields."
Rosato continued, "Period-end loans and deposits decreased three percent and two percent, respectively, from the close of the first quarter.
"The $1.4 billion decline in period-end loans was driven by the forgiveness of $970 million in PPP balances, $530 million in lower retail balances, and a $130 million reduction in mortgage warehouse.
"Conversely, the loan portfolio benefited from strong results in our specialized industry verticals within C&I and LEAF.
"The $894 million decline in period-end deposits was equally attributable to lower brokered deposit balances and seasonal outflows in our municipal business.
"Importantly, non-interest-bearing deposits continued to grow, up three percent linked-quarter and now account for 32 percent of total period-end balances. Finally, capital ratios remain strong and improved linked-quarter for both the Bank and Holding Company." ■