FIRST BUSINESS FINANCIAL SERVICES (FBIZ) has reported 42.02 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $2.54 million, or $0.29 a share in the quarter, compared with $4.38 million, or $0.50 a share for the same period last year.
Revenue during the quarter dropped 16.43 percent to $15.40 million from $18.42 million in the previous year period. Net interest income for the quarter rose 4.69 percent over the prior year period to $15.30 million. Non-interest income for the quarter fell 11.26 percent over the last year period to $3.64 million.
FIRST BUSINESS FINANCIAL SERVICES has made provision of $3.54 million for loan losses during the quarter, up 1,132.40 percent from $0.29 million in the same period last year.
Net interest margin contracted 9 basis points to 3.50 percent in the quarter from 3.59 percent in the last year period. Efficiency ratio for the quarter improved to 63.63 percent from 64.82 percent in the previous year period. A decline in efficiency ratio indicates a rise in profitability.
"First Business has long delivered superior asset quality as a result of our talented employees, deep commercial client relationships and disciplined underwriting," said Corey Chambas, president and chief executive officer. "Unfortunately, the increased reserves on certain loans at our Alterra subsidiary significantly impacted our bottom line. We are taking action to further enhance our policies, processes, controls, training, talent and reporting structures to help ensure First Business’s proven credit culture and discipline are instilled throughout the Company. In order to meet market demand and drive high-quality growth in 2017 and beyond, we are working to ensure future growth is achieved in the way that has historically served our company and shareholders well. Consequently, we have temporarily slowed our SBA production while making investments to enhance the infrastructure, processes, capacity and scalability of the SBA platform."
Assets outpace liabilities growthTotal assets stood at $1,772.44 million as on Sep. 30, 2016, up 1.62 percent compared with $1,744.15 million on Sep. 30, 2015. On the other hand, total liabilities stood at $1,612.51 million as on Sep. 30, 2016, up 1.02 percent from $1,596.19 million on Sep. 30, 2015.
Loans outpace deposit growthNet loans stood at $1,438.23 million as on Sep. 30, 2016, up 5.61 percent compared with $1,361.81 million on Sep. 30, 2015. Deposits stood at $1,566.20 million as on Sep. 30, 2016, up 1.74 percent compared with $1,539.37 million on Sep. 30, 2015. Investments stood at $189.59 million as on Sep. 30, 2016, up 4.12 percent or $7.50 million from year-ago. Shareholders equity stood at $159.93 million as on Sep. 30, 2016, up 8.09 percent or $11.96 million from year-ago.
Return on average assets moved down 46 basis points to 0.56 percent in the quarter from 1.02 percent in the last year period. At the same time, return on average equity decreased 555 basis points to 6.38 percent in the quarter from 11.93 percent in the last year period.
Nonperforming assets moved up 140.22 percent or $15.90 million to $27.24 million on Sep. 30, 2016 from $11.34 million on Sep. 30, 2015. Meanwhile, nonperforming assets to total assets was 1.54 percent in the quarter, up from 0.65 percent in the last year period.
Book value per share was $18.35 for the quarter, up 7.88 percent or $1.34 compared to $17.01 for the same period last year.
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