Peapack-Gladstone Financial Corporation (
NASDAQ Global Select Market:PGC
) (the Corporation) recorded net income of $1.9 million and diluted earnings per share of $0.18, for the quarter ended September 30, 2010. This compared to diluted earnings per share of $0.10 for the quarter ended September 30, 2009 and diluted earnings per share of $0.16 for the quarter ended June 30, 2010.
When compared to the quarter ended September 30, 2009, the September 2010 quarter included increased net interest income, increased income from the PGB Trust and Investment business, increased other income, increased net gains on sales of securities, and a reduced provision for loan losses, the effects of which were partially offset by a write-down of the Corporation’s investment in various equity securities.
Frank A. Kissel, Chairman and CEO, stated, “We are pleased to have shown earnings growth this quarter, which contributed to continued growth in capital. Building capital internally to redeem the Treasury’s Capital Purchase Program investment over time, while remaining well capitalized, continues to be an important business objective of the Corporation.”
The Corporation’s provision for loan losses for the quarter ended September 30, 2010 was $2.0 million, reflecting a lower level than each of the past 4 quarters. Mr. Kissel noted “Reduced charge-off levels, as well as reduced non-performing loan levels in the current quarter, contributed to the reduced provision.” Mr. Kissel went on to say “We continue to be pleased with the progress we have made in resolving certain problem assets. This progress led to the decrease in non-performing loans from June 30, 2010 to September 30, 2010.”
Net Interest Income and Margin
Net interest income, on a fully tax-equivalent basis, was $12.5 million for both the third quarters of 2010 and 2009.
On a fully tax-equivalent basis, the net interest margin was 3.64 percent for the September 2010 quarter compared to 3.61 percent for the September 2009 quarter. In comparing the September 2010 quarter to the same quarter last year the growth of lower cost core deposits and the intentional run-off of higher cost certificates of deposit contributed to the improved margin. This effect was partially offset by the effect of growth in lower yielding, but less risky cash deposits and investment securities coupled with declining loan balances.