Mercantile Bankshares ( MRBK) said its second-quarter earnings rose 7.7% from the year-ago period. The company earned $73.1 million, or 59 cents a share, compared with $67.9 million, or 56 cents a share, in the year-ago period. Analysts polled by Thomson First Call were expecting earnings of 59 cents a share. Second-quarter net interest margin fell 15 basis point to 4.31%. Net interest income rose 5.9% to $161.4 million, led by rise in average earning assets. Non-interest income rose 7.3% to $64.5 million in the quarter. Total deposits at the end of the quarter were $12.44 billion, up 5.2%. "As I have said in the past, we are not immune from the difficult interest rate and competitive environment facing banks generally," said president and chief executive Edward J. Kelly. "We did manage, however, to grow net interest income and earnings in the second quarter while dealing with rising liability costs and intense competition for deposits and loans."