Cambridge Bancorp (OTCBB: CATC) today reported unaudited net income of $3,511,000 for the first quarter of 2014 compared to $3,331,000 for the same quarter in 2013. The earnings increase of $180,000 (5.4%) was attributable to a combination of solid growth in net interest income and a modest increase in noninterest income partially offset by higher noninterest expense for the quarter ended March 31, 2014. Diluted earnings per share were $0.89 for the first quarter of 2014 versus $0.85 for the same period in 2013.
“We are pleased to report another strong quarter,” noted Joseph V. Roller II, president and CEO. “The Bank continues to build off last year’s momentum with growth across all areas of the Company.”
Net interest income for the quarter ended March 31, 2014 was $11.8 million compared to $11.0 million in the first quarter of 2013. The quarter-over-quarter net interest income increase of $859,000 (7.8%) was driven by robust loan growth in 2013. Interest on loans for the first quarter of 2014 was $9.7 million, an increase of $1.3 million (15.6%) compared to the same quarter in 2013. This increase was offset by lower interest on taxable investment securities of $661,000 (24.5%) as the Bank has been shifting earning assets from investment securities to loans. This shift has benefitted the Bank’s net interest margin, which overall increased by 5 basis points to 3.36% for the quarter compared to 3.31% for the quarter ended March 31, 2013.
Noninterest income of $6.0 million for the March 2014 quarter was up $156,000 (2.6%) compared to the same quarter in 2013. The Bank continued to grow Wealth Management income, which increased $440,000 (11.7%) between the comparable periods, from new account growth and market appreciation. Assets under management grew to $2.2 billion at the end of the first quarter 2014 from $2.1 billion at year-end 2013. The healthy increase in Wealth Management income was offset by a considerable reduction in gains on loans held for sale, which dropped from $298,000 to $25,000 quarter-over-quarter. Similar to the industry, the Bank experienced a precipitous drop in mortgage refinance activity compared to the first quarter of 2013.