Ohana Pacific Bank, coming off its third straight year of profits, is now planning to pay its first-ever dividend.

The state’s smallest bank, which in mid-December opened a second branch, said this week net income in 2013 rose 25.5 percent to $1.05 million from $833,000 in 2012. Those results continued a turnaround for the bank, which lost money its first five years before running off a streak of 13 straight profitable quarters.

The dividend of 10 cents a share will be payable March 10 to shareholders of record as of this past Wednesday. Ohana Pacific’s thinly traded shares, which exchange hands on the over-the-counter market under the ticker OHPB, last traded at $4 a share on Sept. 16. The company had 2,067,645 common shares outstanding as of Wednesday.

Ohana Pacific’s net income was down 22.9 percent in the fourth quarter to $216,000 from $280,000 in the year-earlier quarter, primarily because of bonus expenses and costs tied to the opening of its new in-store branch Dec. 14 within the Palama Super Market in Kalihi. Loans, though, grew 10.1 percent to $75.3 million from $68.4 million.

"We’re pretty happy about the results with the steady increase in loans and the new branch opening during the quarter," Ohana Pacific President and Chief Executive Officer James Hong said. "The branch is steadily picking up the volume with increasing activities. The branch will serve not only as an independent branch, but also as an additional service to our existing customers at our main office (at 1357 Kapiolani Blvd. near Ala Moana Center)."

Hong said the bank is hoping to open another branch by the beginning of next year.

"The location is not determined yet, but Waikiki should be one of the very strong possibilities," he said.

Ohana Pacific, which caters primarily to the Korean community and small and midsize businesses, boosted assets 9.3 percent in the quarter to $104.7 million and increased deposits 9.5 percent to $90.1 million.

Its net interest income — the spread between lending rates and deposit rates — fell 6.6 percent to $869,000 from $930,000 in the year-earlier quarter. Net interest margin slipped to 3.47 percent from 3.71 percent.

Noninterest income, which includes service charges and fees, rose 15.1 percent to $84,000 from $73,000.

Nonperforming assets — loans overdue by 90 days or more — improved as they fell 34.5 percent to $645,000 from $985,000.