Staff Reports
GREENSBURG — MainSource Financial Group recorded net income of $8.8 million or 40 cents per common share in the first quarter of 2016, compared to $7.7 million, or 35 cents per common share in the first quarter of 2015.
During the first quarter of 2015, the company reported it incurred a $2.4 million charge related to prepayment of Federal Home Loan Bank advances and realized $252,000 of gains from the sale of investment securities. The sum of these items reduced earnings per share by 6 cents during that period.
Archie M. Brown Jr., MainSource president and chief executive officer, said year over year, the company’s loan portfolio grew by 9 percent. This growth, combined with a 34 percent increase in interchange income, led to a strong earnings performance, he said.
For the first quarter, loan balances were flat with year-end and a little less than the company expected, he said. During the third and fourth quarter of 2015, the company was able to grow loans on an annualized bases in excess of 15 percent, he said. The flattening of the loan book for the quarter was related to a seasonal line of credit reductions, the payoff of several problem credits and a general softening of loan activity, he said. Recently, loan pipelines have increased and the company is anticipating a rebound in growth in the second quarter.
The merger process with Cheviot Financial Corp. is going well and is expected to be completed in the second quarter, Brown said. The MainSource board has approved an increase to the quarterly common dividend in the first quarter by 7 percent, to 15 cents per common share.
Net interest income was $26.4 million for the first quarter of 2016 compared to $25.1 million a year ago, attributed to an increase in earning assets.
The company’s non-interest income, excluding investment securities gains, was $11.6 million for the first quarter, compared to $11.1 million for the same period in 2015.
The company’s non-interest expense was $26.2 million for the first quarter, compared to $27 million in the first quarter of 2015.
Total assets were $3.41 billion at March 31, which represents a $261 million increase from a year ago. The increase was primarily related to acquiring branches in the third quarter of 2015 in addition to organic loan growth, the company said.
MainSource has local offices in Columbus, Hope, Edinburgh, North Vernon and Westport, in addition to locations inside retail stores and ATM locations.
