- Net interest and dividend income was stable at $7.7 million for both the quarter ended September 30, 2012, and June 30, 2012, respectively. The net interest margin decreased 6 basis points from the second quarter 2012. This resulted from a decrease of 6 basis points in the yield on interest-earning assets partially offset by a decrease of 3 basis points in the cost of interest-bearing liabilities and an increase in interest-earning assets of $12.5 million.
- Noninterest income increased $280,000 primarily due to increases of $107,000 in income from bank-owned life insurance (“BOLI”) and $70,000 in fee income from the third-party mortgage company. In the second quarter 2012, management redeemed certain BOLI policies, which resulted in a charge to noninterest income of $102,000 for transferring the policies to a different carrier. In the third quarter 2012, the Bank recorded an increase of $70,000 in fees from the third-party mortgage company which was due to the referral of low rate residential loans to the mortgage company, rather than retaining them on the Bank’s balance sheet.
- Commercial real estate loans increased $6.1 million to $240.4 million and residential loans increased $1.0 million to $223.8 million. This was offset by a decrease of $8.3 million in commercial and industrial loans, which were $115.4 million at September 30, 2012. Commercial and industrial loans were impacted by lower utilization of lines of credit, which decreased by $4.8 million during the quarter. While in prior quarters management has used residential loan growth to supplement the loan portfolio, the long-term strategy remains focused on commercial lending. The Company hired two experienced commercial lenders during the second half of 2012.
Westfield Financial, Inc. (the “Company”) (NasdaqGS:WFD), the holding company for Westfield Bank (the “Bank”), reported net income of $1.4 million, or $0.06 per diluted share, for the quarter ended September 30, 2012, compared to $974,000, or $0.04 per diluted share, for the quarter ended June 30, 2012, and $1.5 million, or $0.06 per diluted share, for the quarter ended September 30, 2011. For the nine months ended September 30, 2012, net income was $4.7 million, or $0.19 per diluted share, compared to $4.3 million, or $0.16 per diluted share, for the same period in 2011. Selected financial highlights for the third quarter 2012 include: