SANTA ROSA - Santa Rosa-based Exchange Bank announced a third quarter profit of $3 million today, marking $9 million in net income as of Sept. 30 and outpacing the same period last year by 12 percent.
It is the tenth consecutive profitable quarter for the bank, according to the release. A shareholder dividend suspended in Sept. 2008, known for the majority stake that has funded the Doyle scholarship at Santa Rosa Junior College for more than 60 years, remains on hold.
“Our work to restoring our community bank back to a full recovery is still incomplete. Reinstating the dividend remains our highest priority, however, for the near term, the level of problem assets and the uncertainty we still have with regard to the sustainability of this soft recovery compels us to be practical in retaining our capital reserves and earnings,” wrote President and CEO William Schrader in the release.
The bank reported that its amount of non-performing assets has decreased by 30 percent since Dec. 31, 2008. The reduction - from $75 million to $52 million - has occurred on a borrower-by-borrower basis, with an ultimate goal of less than $30 million.
Net interest income dropped by $3 million versus the third quarter of 2010, a product of historically low interest rates, according to the bank.
Loans increased by $17 million compared to the same period last year, a movement that the bank attributed to an increased loan demand seen since the second quarter of this year. The net allowance for loan losses compared to Q3 2010 was decreased from $34.1 million to $33.3 million.
Deposits also increased, by $36 million, reflecting uncertainties about investing in financial markets and a flight from large banks that have enacted new customer fees in response to the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Exchange Bank reported an unaudited $1.55 billion in total assets in the release, an increase of $50 million in assets since Q3 2010.
The bank said that it expects to focus on recovering asset quality at least into 2012.
