SANTA ROSA -- Summit State Bank (Nasdaq: SSBI) on Tuesday reported first-quarter income increased 21 percent from a year before, and loans and deposits grew.

The Santa Rosa-based bank also announced an 11 cent quarterly dividend for common shareholders, payable on May 23 to shareholders of record as of May 15.

"Our stronger earnings continue to be driven by the quality of our team and its deep commitment and hard work to support our growing portfolio of quality customer relationships resulting in our best quarter to date," said Tom Duryea, president and CEO, in the announcement.

Summit State Bank ( had net income of $1.21 million for the three-month period ended March 31 and shareholder earnings of 24 cents per share. Quarterly net interest income increased 3.8 percent to $4.27 million from the same quarter in 2013.

The bank's loan portfolio grew by 4.6 percent to $293.1 million over the 12-month period. Commercial real estate lending was the primary driver of that increase, according to the bank.

"Loan production picked up in the first quarter with annualized growth of 7 percent," said Linda Bertauche, chief operating officer, in the announcement. "This is a result of both the strong efforts of our community banking team and the steady and continuing improvements of the Sonoma County economy."

The return on average assets at quarter-end was 1.07 percent, compared with 0.93 percent a year before. The net interest margin, which measures the spread between interest expenses and interest income, was largely unchanged at 3.92 percent, compared with 3.93 percent.

Summit had $462,000 in noninterest income for the quarter, driven largely by the sale of a foreclosed property. The bank had no provision for loan losses for the comparable first quarters. Nonperforming assets declined by more than $500,000 and now represent 2.1 percent of the bank's portfolio.

Total assets increased 5 percent to $460.1 million over the 12-month period. Total deposits rose 4.7 percent to $358.4 million.

Mr. Duryea cited a growth in core deposits -- that is, deposits in the bank's primary market -- as among the drivers of the Summit's success in recent years. The bank has grown its core deposits from $60 million to nearly $200 million over five years, providing more capital for lending activities and reducing its cost of funds by more than $1 million each year.

Shares in Summit State Bank were trading at $11.17 at 11:09 a.m. Pacific Time, up 1.6 percent from the opening price for the session.