Boston Private Financial Holdings, Inc. (NASDAQ: BPFH) (the “Company” or “BPFH”) today reported third quarter 2012 GAAP Net Income Attributable to the Company of $16.5 million, compared to GAAP Net Income Attributable to the Company of $14.2 million in the second quarter of 2012. BPFH reported third quarter diluted earnings per share of $0.19 compared to diluted earnings per share of $0.17 in the second quarter of 2012.
On a year-over-year basis, GAAP Net Income Attributable to the Company increased from $11.7 million in the third quarter of 2011. Earnings per share increased from $0.14 on a year-over-year basis.
“Our third quarter results reflect the three management initiatives we’re executing to offset continuing pressure on Net Interest Income,” said Clayton G. Deutsch, CEO and President. “These initiatives are to place greater emphasis on growing our fee-based businesses; continue to improve our credit quality; and continue to tightly manage expenses. This month we have implemented a senior executive restructuring that will enable us to save in excess of $5 million per year of senior executive costs. We remain focused on these three initiatives as we continue our efforts to build earnings,” concluded Mr. Deutsch.
Net Interest Income Flat, Fee Revenue Up in Q3
Net Interest Income in the third quarter was $46.4 million, down 1% from $46.6 million in the second quarter of 2012. Year-over-year, Net Interest Income increased 3% from $45.1 million. Fees and Other Income for the third quarter increased 2% to $28.6 million from $28.0 million in the second quarter of 2012. On a year-over-year basis, Fees and Other Income decreased 4% from $29.7 million.
Net Interest Margin was 3.11% in the third quarter, down 24 basis points from 3.35% in the second quarter of 2012. Net Interest Margin in the third quarter was negatively impacted by a short term deposit that inflated Average Assets. In addition, Net Interest Margin in the second quarter of 2012 had the positive effect of pre-payment penalties and the recovery of nonaccrual interest income. On a year-over-year basis, Net Interest Margin decreased 14 basis points from 3.25%.