Provident reports 13% gain in second-quarter net income


July 22, 1999|By Kevin McQuaid | Kevin McQuaid,SUN STAFF

Provident Bankshares Corp., continuing an earnings surge that has resulted in double-digit growth for the past two dozen consecutive quarters, generated a 13 percent increase in its net income in the second quarter.

The Baltimore banking company attributed its $11 million in net income primarily to strong growth in consumer and commercial loans, which rose 29 percent and 28 percent, respectively, in the three-month period that ended June 30.

Provident's earnings rose 16.7 percent a share, to 42 cents a share.

"We've done well attracting borrowers for our home equity loans, and we've purchased a number of second mortgages, which is a good business for us," Pete Martin, Provident's chairman and chief executive, said yesterday. "And deposits have been a big story for us as we continue to gain market share there."

Provident's core deposits increased $105 million, or 5 percent, from June 30, 1998. Total assets were $4.9 billion.

Provident's return on average equity in the second quarter was 14.78 percent, vs. 14.02 percent for the comparable period last year.

The company, whose Provident Bank of Maryland subsidiary operates 69 branch offices in seven Maryland counties, Baltimore and southern York County, Pa., generated a 13.1 percent rise in net interest income, to $36.7 million.

At the same time, the company's nonperforming loans declined to 0.25 percent, or $8.1 million, of the $3.2 billion in total loans outstanding during the quarter, compared with 0.5 percent at June 30, 1998. Net charge-offs for the quarter were $2.0 million or 0.24 percent of average loans, compared with $2.1 million, or 0.31 percent, for the same period last year.

As of June 30, the allowance for loan losses was $38.7 million, or 1.2 percent, of total loans outstanding.

Provident's total capital was $283 million as of June 30, while its book value stood at $11.10 per common share.

For the first half, Provident had net income of $21.3 million, or 81 cents a share, gains of 12 percent and 14 percent, respectively.

Pub Date: 7/22/99

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