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First of LI Corp. 2Q income down 1.8%

First of Long Island Corp. said its second quarter income dipped 1.8 percent from a year earlier on higher noninterest expense and a higher provision for loan losses because it loaned more money.

The Glen Head-based holding company for First National Bank of Long Island said Monday that net income for the three months ended June 30 was $5.3 million, or 58 cents a share, compared with $5.4 million, or 60 cents a share, a year earlier.

Its $947,000 provision for loan losses in the quarter was up 52 percent from a year earlier.

"The increase in the provision for loan losses primarily reflects more loan growth in the second quarter of 2013 than the same period last year," the bank said. Total loans at the end of the second quarter were $1.3 billion compared with $1.1 billion a year earlier.

Total assets at the end of the quarter were $2.23 billion, up from $2 billion a year earlier.

First of Long Island's net interest income after the provision for loan losses -- the difference between the revenue generated from a bank's assets and the expenses associated with liabilities -- was $14.5 million, down 1 percent from 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 -- fell from 3.36 percent a year earlier to 3.2 percent in this year's second quarter. The bank blamed low interest rates.

The bank said the increase in noninterest expense included increased salaries and higher occupancy and equipment expenses from increases in general maintenance and repairs, snow removal cost and rent.

The bank's allowance for loan losses to total loans was 1.53 percent at June 30, compared to 1.62 percent at year-end 2012.

"The decrease in the reserve coverage ratio is largely due to a reduction in historical loss rates and an improvement in general economic conditions," the bank said.

The bank opened a new branch in Massapequa Park March 6, bringing the total to 36. It plans to open another in branch Sayville in the fall.

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