Western Alliance Bancorporation announced its financial results for the third quarter 2015. These results include the performance of Bridge Bank, which was acquired on June 30, 2015.
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Net income was $59.1 million, compared to $34.7 million for the second quarter 2015, and $40.9 million for the third quarter 2014.
Net interest income was $137.4 million in the third quarter 2015, an increase of $28.7 million, or 26.4% from $108.7 million in the second quarter 2015, and an increase of $39.3 million, or 40.1%, compared to the third quarter 2014. Net interest income in the third quarter 2015 includes $7.0 million of total accretion income from acquired loans.
The company’s net interest margin increased in the third quarter 2015 to 4.59%, compared to 4.41% in the second quarter 2015, and 4.43% in the third quarter 2014. The increase in net interest margin for the quarter primarily relates to accretion from acquired Bridge loans.
Operating non-interest income was $8.5 million for the third quarter 2015, compared to $5.6 million for the second quarter of 2015, and $5.5 million for the third quarter 2014.1
Net operating revenue was $145.9 million for the third quarter 2015, an increase of $31.6 million, or 27.6%, compared to $114.3 million for the second quarter 2015, and an increase of $42.4 million, or 40.9%, compared to $103.6 million for the third quarter 2014.1
Operating non-interest expense was $72.2 million for the third quarter 2015, compared to $54.6 million for the second quarter 2015, and $51.7 million for the third quarter 2014.1 The company’s operating efficiency ratio1 on a tax equivalent basis was 46.8% for the third quarter 2015, a decline from 44.7% for the second quarter 2015, and an improvement from 47.1% for the third quarter 2014.
The company views its pre-tax, pre-provision operating earnings as a key metric for assessing the company’s earnings power, which it defines as net operating revenue less operating non-interest expense. For the third quarter 2015, the company’s pre-tax, pre-provision operating earnings were $73.7 million, up 23.5% from $59.7 million in the second quarter 2015, and up 42.2% from $51.9 million in the third quarter 2014.1
The non-operating items for the third quarter 2015 consisted primarily of net unrealized gains on assets and liabilities measured at fair value of $5.4 million. Other non-operating items include acquisition / restructure expense of $0.8 million incurred in connection with the acquisition of Bridge, $0.1 million of net losses on sales of investment securities, and a $0.1 million net gain on sales and valuations of repossessed and other assets.
The company had 1,415 full-time equivalent employees and 47 offices at September 30, 2015, compared to 1,120 employees and 39 offices at September 30, 2014. ■