PITTSFIELD -- The reduction in residential mortgage refinancing demand caused core earnings for Berkshire Hills Bancorp to drop slightly during the third quarter from the same time period last year.
But core income for Berkshire Bank's holding company has still increased by 18 percent to $36.7 million over the first nine months of 2013 due to the financial institution's organic and acquisition growth initiatives, according to results for the period ending Sept. 30 that were released Tuesday.
Berkshire's core earnings for the third quarter were $10.7 million compared to $11.4 million during the third quarter of 2012, as the reduction in residential mortgage refinancing demand led to an after-tax reduction of 10 cents per share in mortgage banking fees.
That dip allowed the bank's third-quarter core earnings per share to drop to 43 cents per share, compared to 52 cents per share during the same time period in 2012.
Despite that drop, Berkshire's earning assets increased 5 percent, or $227 million, during the third quarter from $5.2 billion to $5.45 billion. That sum included a 16 percent annualized increase in commercial business loans and total loans that totaled $153 million.
Other third-quarter highlights included an 8 percent growth in total commercial loans, a 7 percent rise in total deposits, a 16 percent increase in demand deposits, and a net interest margin of 3.93 percent.
The bank's net revenue grew 17 percent during the third quarter, and has increased 24 percent during 2013 due to organic and acquisition growth strategies, according to the bank.
In July, Berkshire announced plans to acquire 20 retail bank branches from Bank of America that are located in eastern and central New York. The $14.4 million transaction is expected to be finalized by the first quarter of 2014.
Of the 180 banks that are located in Massachusetts, Berkshire is one of only 20 that are publicly traded, according to the Massachusetts Bankers Association. Being in that situation gives Berkshire the financial flexibility to pursue transactions that many other state financial institutions cannot.