Business & Tech

Rockville Bank Posts $3.3 Million in Quarterly Income

The number represents a year-to-date improvement.

Rockville Financial Inc., the holding company for Rockville Bank, has declared net income of $3.3 million, or 12 cents per diluted share, for the quarter ended June 30, according to a financial statement.

That is compared to to net income of $2.9 million, or 11 cents per diluted share, for the quarter ended June 30, 2012.

Core operating earnings for the second quarter of 2013 were $4.1 million, or 15 cents per diluted share, adjusted "for expense reduction actions the company completed during the second quarter that will improve the company’s non-interest expense run rate by $1.5 million annually," bank officials said in the financial disclosure. 

The adjustments for the quarter ended are comprised of expenses of $809,000 (pre-tax) for the impact of a branch lease termination agreement and $561,000 (pre-tax) for termination expenses related to position eliminations, as well as income of $329,000 (pre-tax) for securities gains,  bank officials said in the financial disclosure.

The quarter included 29 percent annualized commercial loan growth, along with "strong residential mortgage originations, particularly purchase mortgages, significant deposit growth in our new West Hartford Banking Center and new fee income sources, combined with share count and legacy expense reductions," the bank's top executive said. 

Added President and Chief Executive Officer William H.W. Crawford IV, "Both the Company’s strong loan and deposit growth and flat linked quarter core operating expense reflect Rockville’s strategy for continued organic growth and commitment to enhancement of long-term shareholder value.” 

Crawford continued, “Given market conditions and the impact of increased interest rates on security portfolio valuations and capital, the company's net earnings and tangible book value performed well during the second quarter. Rockville continues to balance reinvestment in the company with current period profits, and remains mindful of operating leverage, protecting tangible book value and mitigating interest rate risk. Each quarter we remain focused on enhancing long term shareholder value. I would like to thank our team of dedicated employees who deliver a superior customer experience every day.” 

Earnings in both 2013 and 2012 were affected by non-core income and expense, Crawford said.

Here are some highlights from the quarter: 

• 8 percent core operating revenue growth, compared to second quarter 2012.

• 3percent decrease in core operating revenue, compared to linked quarter.

• 15 person increase in core operating expense, compared to second quarter of 2012.

• 1 percent decrease in core operating expense, compared to linked quarter.

• $1 million net gain from sales of loans, compared to $2.1 million in the linked quarter.

• 3.48 percent tax equivalent net interest margin, compared to 3.47 percent in the linked quarter.

• 10 precent annualized linked quarter deposit growth.

• 38 percent annualized linked quarter non-interest bearing deposit growth. 


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