Willimantic - The acquisition of Newport Bancorp. led to widening financial losses at SI Financial Group Inc., parent of the Savings Institute Bank & Trust, in the latest quarter.
The Willimantic-based bank reported after the market closed Thursday a profit miss of $1.7 million during the third quarter of the year, $1 million more than for the same period last year. The loss amounted to 17 cents for each share of stock, compared with a 7-cent loss during last year's third quarter.
Much of the before-taxes loss in the quarter, $1.3 million, was attributable to Savings Institute's decision to purchase the Rhode Island-based community bank. The Newport Fed acquisition has cost the bank $2.2 million so far this year.
"We welcome our new customers and shareholders as a result of our successful acquisition and integration of Newport Bancorp," Rheo A. Brouillard, president and chief executive officer of Savings Institute, said in a statement. "We are eager to focus our efforts on servicing our new and existing customers and to pursue opportunities in our expanded market within Rhode Island,"
Savings Institue said its profit miss so far this year has been $1.9 million, or 19 cents a share. This compared to a profit of $373,000, or 4 cents a share, through the same period last year.
Despite the losses, the bank reported that profits related to interest income were on the rise in the third quarter, up by almost $600,000 from a year ago. The increase was related to higher loan balances, the bank said.
Savings Institute said both its provision for loan losses and nonperforming loans were down so far this year, a positive trend after losses mounted following the financial crisis.
The bank said it also recorded a loss of $922,000 in the third quarter related to the sale of collateralized debt and mortgage-backed securities that had turned sour. A decline in mortgages also accounted for part of the profit miss.
Total assets of the bank, now put at $1.37 billion, saw a rise of $415.4 million since the first of the year, mostly because of the Newport Fed acqusition. Liabilities also saw a major uptick of $388.4 million to $1.22 billion.