Four community bank companies that have a presence in the Spokane-Coeur d'Alene area have reported increases in third-quarter net income.
Two of those banks had posted a loss during the third quarter of 2011.
While all are reporting challenges in the current low interest rate environment, a couple have experienced an uptick in mortgage-loan originations, suggesting a resurgence of the housing market.
Northwest Bancorporation Inc., the Spokane-based parent of Inland Northwest Bank, has posted third-quarter net income applicable to common shareholders of $229,000, or 7 cents a diluted share, up from a net loss of $659,000, or 21 cents a share, in the year-earlier period.
Randall L. Fewel, president and CEO of both the company and the bank, says in a press release, "This marks our third consecutive quarter of profitability, which is directly related to the progress we are making in reducing the level of problem loans."
Provisions for loans losses in the third quarter were $600,000, compared with $2.5 million in the year-earlier quarter. Net charge-offs for problem assets in the third quarter amounted to $1.4 million, less than half the $3.2 million in charge-offs in the year-earlier quarter.
Net loans as of Sept. 30 were $259.1 million, down from $262.5 million a year earlier.
Total assets, however, increased, to $395 million on Sept. 30 from $393.4 million a year earlier.
Northwest Bancorp says its revenue from origination of mortgage loans climbed by $612,000, or 112 percent, in the third quarter compared with the year-earlier quarter.
"Revenue from residential mortgage origination for INB is the best it has been in five years, and I believe this is a good sign that the local housing market is beginning to improve," Fewel says.
Inland Northwest Bank operates 11 branches in the Inland Northwest.
Glacier Bancorp Inc., the Kalispell, Mont.-based holding company that owns Coeur d'Alene-based Mountain West Bank and 10 other subsidiaries, has reported third-quarter net income applicable to common shareholders of $19.4 million, or 27 cents a diluted share.
That's up substantially compared with the third quarter of 2011, when Glacier had a net loss of $19 million, or 27 cents a share. During that quarter, Glacier took a one-time impairment charge of $32.6 million related to acquisitions completed more than 10 years ago and to overall volatility in bank stock prices since then.
Of its latest performance results, Glacier President and CEO Mick Blodnick says, "The company had another solid quarter with credit costs continually improving and helping to offset the pressure to net-interest income."
While net income improved, total loans fell to $3.41 billion as of Sept. 30 from $3.52 billion a year earlier. Glacier attributes the decrease in its loan portfolio to weaker demand and continued uncertainty in the economy.
To offset the lack of loan growth, Glacier says it's buying investment securities, including corporate and municipal bonds and U.S. agency collateralized mortgage obligations. In the 12-month period ending Sept. 30, the company had increased its investment securities by $651 million, which is a reason for the rise in its total assets to $7.63 billion, from $7.04 billion a year earlier.
Glacier declared a dividend of 13 cents a share for the quarter.
Mountain West has six branches in the Spokane-Coeur d'Alene area, including one in Spokane Valley.
Intermountain Community Bancorp, the Sandpoint-based holding company for Panhandle State Bank, has posted third-quarter net income applicable to common shareholders of $343,000, or 1 cent a diluted share, up from a net loss of $1.2 million, or 14 cents a share, in the year-earlier quarter.
The company says reductions in operating expenses and loan-loss provisions offset decreases in interest and other income.
Curt Hecker, Intermountain's CEO, says in the company's earnings release, "These results demonstrate a steady progression of improved performance amidst a very challenging interest-rate environment by focusing on areas the company can control."
Net loans decreased to $502.9 million as of Sept. 30, from $525.5 million a year earlier.
Intermountain, however, had an increase in total assets during the 12-month period, to $962.8 million as of Sept. 30 from $926.5 million a year earlier. The company says it bolstered its assets by investing cash in higher-yield investments.
The company's nonperforming assets dropped to 1.17 percent of total assets on Sept. 30, from 1.91 percent a year earlier.
Intermountain's Panhandle State Bank has five offices in the Spokane-Coeur d'Alene area, including a private banking office in downtown Spokane and a branch in Spokane Valley. The company also owns Magic Valley Bank, in Idaho.
Walla Walla-based Banner Corp., which operates 14 Banner Bank branches in the Spokane area, says its third-quarter net income rose to $15.6 million, or 79 cents a diluted share, from $6 million, or 24 cents a share, in the year-earlier period.
Banner President and CEO Mark J. Grescovich says the rise in earnings is due largely to increases in revenues from core operations.
"Our deposit fees and other service-charge income remained strong, increasing by 10 percent compared to the third quarter a year ago," Grescovich says. "And our revenues from mortgage banking operations again increased and were more than two times higher than in the third quarter of 2011."
Also, the bank repurchased 40 percent of its senior preferred stock during the quarter, at an average price of $959 per share. The company realized gains of $2.1 million from the purchases.
Net loans at Banner were $3.13 billion as of Sept. 30, down from $3.14 billion a year earlier.
Total assets were down slightly as well, to $4.27 billion on Sept. 30, compared with $4.29 billion a year earlier.
Nonperforming assets accounted for 1.38 percent of total assets at the end of the third quarter, which Banner says is 61 percent decrease from a year earlier.
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