A reduction in loan loss reserves helped Lake Success-based Astoria Financial Corp. report higher net income in the third quarter from a year earlier.
The corporate parent of the 86-branch Astoria Bank said net income was $18.8 million in the three months ended Sept. 30, up 11 percent from $16.9 million a year earlier. Diluted earnings per common share rose from 15 cents in the third quarter of last year to 17 cents in the quarter this year.
Astoria said a $2.5 million provision for loan losses in last year's third quarter was replaced by a $3 million credit or "release" in this year's quarter. The gain more than offset the drag on profits from lower interest and noninterest income.
Monte N. Redman, Astoria's president and chief executive, said in a statement, "Given the challenging interest rate environment that we continue to find ourselves operating in, we are pleased with the results that we have reported today."
Third-quarter net interest income, the difference between the revenue generated from a bank's assets and the expenses associated with liabilities, was $84.6 million, down from $86.2 million a year earlier. Net interest margin, a measure of the difference between the interest a bank earns on its assets such as loans and the interest it pays out to depositors, was 2.31 percent in this year's third quarter, up from 2.28 percent a year earlier.
Noninterest income for this year's third quarter was $13.8 million, compared to $15.3 million for the 2013 third quarter. Astoria blamed the decrease primarily on declines in net mortgage banking income and other operating income.
Total assets at Sept. 30 were $15.5 billion.
Astoria Federal Savings and Loan Association changed its name to Astoria Bank in June.