ChoiceOne 3Q Income Up 50 percent
SPARTA — ChoiceOne Financial Services Inc. reported third quarter net income of $674,000, an increase of $224,000, or 50 percent, from the third quarter of 2006. Earnings per share for the quarter were 20 cents, compared with 27 cents per share earned in the same period last year.
Net income for the first nine months of 2007 was $2.57 million, compared with $1.53 million in the first nine months of 2006.Earnings per share for the first three quarters were 79 cents, representing a 14 percent decrease from 92 cents per share for the same period the year before. The company indicated that earnings per share in 2007 were affected by the issuance of ChoiceOne stock in the merger with Valley Ridge Financial Corp. in November 2006, which nearly doubled the number of shares outstanding. The growth in net income this year was a result of the merger, as well.
The provision for loan losses increased $590,000 in the quarter and $925,000 in the first nine months compared with the same periods in the prior year. The company indicated that the higher provision level was believed prudent based on a higher level of net charge-offs and nonperforming loans in 2007, the deterioration in certain commercial credits, as well as continued concerns regarding the Michigan economy. CEO James A. Bosserd said the bank recorded an additional loan loss provision in the third quarter, partly due to deterioration in loans with a large commercial developer.
“We continue to work as a community bank in dealing with any of our customers experiencing difficulty,” Bosserd said. “Even with the increased expenses related to distressed loans, we were pleased with the earnings we were able to achieve.”
Total assets as of Sept. 30 were $466 million, an increase of $209 million, or 81 percent, from a year earlier, which ChoiceOne attributed to the merger. Loans grew $137 million, or 75 percent, over the last 12 months, while deposits increased $156 million, or 78 percent, over the 12-month period.