Central Pacific Bank, which suspended its dividend more than four years ago amid a struggle to survive, is bringing it back after the company’s 10th consecutive profitable quarter.

After losing $703.1 million from 2008 to 2010, the state’s fourth-largest bank has resurrected itself since being recapitalized with $325 million in February 2011 from private equity funds and investors.

The bank’s earnings momentum continued in the second quarter with net income rising 32 percent to $14.3 million, or 34 cents a share, said parent company Central Pacific Financial Corp. in a report scheduled for release today. The earnings easily beat analysts’ estimates of 29 cents a share as well as its year-earlier profit of $10.8 million, or 26 cents a share.

"As a result of our strong capital positions and earnings consistency, we elected to reinstate dividend payments at this time, subject to ongoing board review," Central Pacific President and CEO John Dean said.

Central Pacific’s board of directors declared a quarterly dividend of 8 cents a share that represents an annualized yield of 1.7 percent based on Wednesday’s closing price of $18.74. It will be payable Sept. 16 to shareholders of record at the close of business on Aug. 30. The bank had suspended its dividend in the first quarter of 2009.

The reinstatement of the dividend marks another milestone in the turnaround of the bank, which had $496 million in nonperforming assets — loans delinquent for 90 days or more — when Dean took the reins during the first quarter of 2010. Since then, Dean and his team have aggressively been reducing those problem loans by selling them or restructuring the terms.

Central Pacific’s nonperforming assets were $60.9 million at the end of the second quarter, down from $75.3 million at the end of the first quarter and down from $170.3 million on June 30, 2012.

"While it’s no longer the main challenge (for the bank), we’re still able to show good improvement in our asset quality," Dean said.

The bank, which was burned by the real estate meltdown, said in late 2009 that it would stop pursuing new loans on the mainland — primarily in California — and focus on Hawaii. At the end of last quarter, it had $196 million in outstanding loans on the mainland, with $22 million nonperforming. In Hawaii, the bank had about $2.2 billion in loans, with $38 million of that overdue by 90 days or more.

Even as the bank sheds problem loans, it continues to grow its loan portfolio. Total loans and leases rose 12.9 percent last quarter to $2.4 billion from $2.1 billion in the year-earlier period.

"We saw more of the growth happening in the residential mortgage and consumer loans," Chief Banking Officer Lance Mizumoto said. "We are participating in several of the construction projects, and in concert with that, we’re working with the developer to be a preferred lender on the residential mortgage takeouts with several projects."

Low interest rates have been pushing down banks’ net interest margins — the spread between loan and deposit rates. But Central Pacific was able to improve its margin to 3.23 percent from 3.17 percent in the year-earlier quarter because the bank was able to recover $1.7 million in interest from previously nonperforming loans. Without it, the bank’s net interest margin would have been 3.07 percent, or roughly the same as the 3.06 percent it was in the first quarter of this year.

Including the recovery of the loan interest, the bank’s net interest income rose 9.6 percent last quarter to $33.2 million from $30.3 million. Central Pacific also boosted its net interest income by shifting assets from investment securities to loans because of the loan growth.

Noninterest income, which includes service charges and fees, increased 30.8 percent to $17.8 million from $13.6 million, primarily due to the net gain on the sales of $7.7 million in foreclosed assets.

Central Pacific’s earnings included the reversal of $227,000 it had set aside for potential loan losses, but that was far less than amounts it had taken over the previous nine quarters. A year ago, its reversal was $6.6 million.

During the quarter, the bank increased its assets 11.3 percent to $4.7 billion and its deposits 8.2 percent to $3.9 billion.

Central Pacific, which had 902 employees as of June 30, said it plans to add another branch — its 36th — later this year in Kapaa, Kauai.

It also said there are still several sites being considered in Kailua to relocate its existing branch there but that a decision likely won’t be made until next year. One of those sites under consideration, a former Arby’s sandwich shop, is still being explored because of some preliminary indications that there may be iwi, or human remains, at the site, Dean said.