Sturgis Bancorp, Inc. (OTCQX:STBI) has released its 2018 fiscal report in which they have posted a net income of around $3.2 million in the first nine months of the year with the third quarter recording $1.3 million.
The company indicated an increase in revenue for the third quarter of 2018 when compared to last year. The net income for the 2018 third quarter is $1.3 million as compared to 2017 when it was $739,000, and this reflects an increase of 3.95% on the interest margins. However, net interest income indicated an increase of $645,000 rising from $3.7 million to $3.9 million. This growth is attributed to loan interest income which is expected to grow in the final quarter of the year.
Income increase in third quarter
Allowances for loan losses were lower in the third quarter of 2018 as they were at $30,000 compared to 2017 when they stood at $59,000 mainly due to growth in loans. This resulted in the net charge-off holding at $8,000 in 2018 down from $47,000 last year. Noninterest income grew to $1.4 million for the third quarter of 2018from $1.3 million in 2017 which can be attributed to the $69,000 real estate sale. Also, the income from mortgage banking rose to from $161,000 in the third quarter of 2017 to $ 180,000. Equally noninterest expenses increased to $3.7 in the third quarter of 2018 as a result of an increase in advertising expenditure and the company’s engagement in research to better their customer experience.
Income for the first nine months
The company recorded a net income of $3.2 million for the first nine months of 2018 compared to the corresponding $2.3 million in 2017. Consequently, this increased the tax equivalent net outlay by 3.88% up from 3.75% in 2017. The net interest income equally grew to $10.8 million which was essentially a result of an increase in the loan interest income in margins of $1.4 million. Corresponding total interest income indicated an increase of $1.6 million with interest expense rising by $409,000 in in the third quarter of 2018 as a result of employment benefits and salaries which were the major components of the non-interest expense.