Territorial Bancorp posts 6.9% earnings increase, net income of $3.4M

The parent of Territorial Savings Bank posted a 6.9 percent increase in fourth-quarter earnings as assets, deposits and loans grew from year-earlier levels.

Territorial Bancorp Inc.’s net income rose to $3.4 million, or 33 cents a share, from $3.2 million, or 28 cents a share, a year earlier.

Analysts were looking for 31 cents a share in the most recent quarter.

For the year, Territorial’s earnings increased 16 percent to $12.8 million, or $1.17 a share, from $11 million, or 97 cents a share, in 2010.

"This past year we have worked hard to originate quality residential mortgage loans," Territorial Chairman and CEO Allan Kita­gawa said Thursday.

"I am proud of our accomplishment since many other banks have found it difficult to grow their loan portfolio because of low demand and a high level of prepayments of existing loans."

Assets grew to $1.54 billion from $1.44 billion a year ago. Deposits increased to $1.17 billion from $1.08 billion. And loans receivable grew to $688.1 million from $641.8 million due to a gain in residential mortgage loan originations.

Total delinquent loans — 90 days or more past due and not accruing — were $2.3 million as of the end of the year and encompassed 12 loans. That compared with delinquencies of $808,000 a year earlier for seven loans.

The bank’s net interest margin, the difference between what Territorial pays depositors and what it brings in from loans, grew to 3.58 percent from 3.42 percent a year ago.

Kitagawa said one of the bank’s focal points was to increase its net interest margin, which he called "a difficult task given the low-interest-rate environment."

Territorial’s stock rose 25 cents, or 1.2 percent, to $21.25 Thursday on the Nasdaq Stock Market. That’s just below the bank’s 52-week high of $21.29 set on July 21.

Earnings were announced after the market closed.

The bank also increased its quarterly dividend 11.1 percent to 10 cents a share from 9 cents. It will be payable March 1 to shareholders of record as of Feb. 16.