American Savings Bank reported today that its net profit rose 7.7% in the third quarter on the back of a double-digit increase in lending amid rising interest rates.
The state’s third-largest bank increased lending 11% to $5.69 billion from the previous quarter and saw it jump 19.2% on an annualized basis from the April-June period. .
American Savings net income increased to $20.8 million from $19.3 million in the prior quarter. The bank’s profits jumped 18.8% from the previous three months.
“We are pleased with the bank’s strong third quarter and year-to-date results,” American Savings President and CEO Ann Teranishi said in a statement. “We again saw broad-based loan growth during the quarter, reflecting the excellent work of our team as well as the continued recovery of Hawaii’s economy from the pandemic.
“We continued to see positive credit trends despite the inflationary environment, and the rising interest rate environment continued to benefit our net interest margin and overall profitability.”
The bank’s net interest income, which is the difference between what it originates in loans and what it disburses in the form of deposits, rose 9% to $65.7 million from the quarter of the previous year. Its net interest margin rose 6 basis points to 2.96% from the prior quarter and 11 basis points from the April-June period.
Non-interest revenue, which includes fees and commissions, fell 12% to $13 million, as the bank’s mortgage banking revenue fell $1.1 million from the reporting period. last year.
Deposits increased 3.5% to $8.26 billion from the previous quarter.
American Savings released $186,000 from its loan loss reserve in the third quarter, down from the $1.7 million it released from its reserve in the year-ago quarter.
Parent company Hawaiian Electric Industries Inc. will announce its third-quarter results on Nov. 7. Shares of HEI rose $1.07 on Friday to $37.87 ahead of the American Savings earnings release.
Third quarter net
* $20.8 million
Net of the previous year
* $19.3 million