Cambridge Bancorp (OTCBB: CATC) today reported unaudited net income of $3,176,000 for the third quarter compared to $3,161,000 for the same quarter in 2009. Diluted earnings per share (EPS) remained unchanged at $0.84 for the third quarter of 2010 versus the same quarter in 2009. For the nine months ending September 30, 2010, unaudited net income was $10,600,000 versus $7,646,000 for the same period in 2009 – an increase of 38.6%. Key factors driving the $2,954,000 increase in net income were the sale of the Bank’s Merchant Services portfolio last quarter and continued growth in net interest income.
“Although there have been some timid signs of improvement in the economy, the current interest rate environment has had a negative impact on the Bank’s net interest margin. We have been able to offset some of the recent margin pressure through modest growth in the loan portfolio,” notes Joseph V. Roller II, the Bank’s president and CEO. “In addition, non-interest expense trended higher during the third quarter as the Bank opened a new branch in Lexington and made additional investments in marketing. These important investments helped to position the Bank well for continued long term growth.”
Net interest income continued to experience growth despite the Bank’s net interest margin having decreased by 15 basis points versus the third quarter last year which is mainly attributed to lower yields earned on the Bank’s investment securities. The increase of $518,000 (5.2%) in net interest income for the third quarter of 2010 versus the same quarter in 2009 was primarily a function of growth in the mortgage loan portfolio and reduced costs for deposits. For the nine months ending September 30, 2010, net interest income of $31.4 million was $2.9 million (10.2%) higher than the same period in 2009.
Non-interest income of $4.6 million for the September 2010 quarter was down slightly compared to the same quarter in 2009. While the Bank’s Wealth Management income increased by $145,000 for the third quarter of 2010, it was offset by lower deposit account fees and merchant card services income. There were no gains on the disposition of investment securities during the third quarter of 2010 which accounted for a $148,000 decrease in non-interest income versus the same quarter last year.