overcame write-downs and charges, thanks to gains from an exchange offer.
Today, the Westbury, Conn.-based bank announced that it widened its consolidated net loss, which came to $31.6 million. In the year-earlier period, the bank lost $28.7 million.
But net income available to common shareholders grew to $16.8 million in the second quarter, or a 31-cent per share profit, thanks to a boost from the aforementioned exchange offer, which was completed during the quarter. According to the Webster's press release, the exchange offer added $173 million in Tier 1 common equity.
In the year-ago period, the bank posted net loss available to shareholders at 28.9 million, or 56 cents per share.
Analysts surveyed by Thomson Financial expected the bank to post a 46-cent per share loss, though this typically excludes one-time items.
Net interest income, before accounting for provisions in credit losses, dropped 5% in the quarter to come to $119.3 million. Net interest margin grew to 3.04% compared to last quarter's 2.99%. Non-interest income also grew to $35.4 million from a loss of $5.8 million last year.
The bank saw a near $480 million sequential jump in deposits in the quarter to $13.1 billion.
Webster boosted its provision for credit losses to $85 million from $66 million sequentially. Net charge-offs grew to $49.9 million, up from the $30.1 million recorded during the previous quarter. Its allowance for credit losses grew to 2.72% of its total loan portfolio, from 2.33% in the previous quarter.
Still, CEO James Smith also noted an "encouraging" sign in a press release, saying that loan problems like delinquencies and nonperformers were slowing in the quarter "across most loan categories."
Investors apparently liked that idea, sending Webster shares soaring on the news, up 13%, or $1.10, at $9.73.
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