The Hawaii State Federal Credit Union posted lower net income in the first quarter but increased its loans 13.8% and announced plans to open its 10th branch later this summer at the Salt Lake Shopping Center.

The state’s second-largest credit union, with $1.6 billion in assets, said in a financial report due out today that its earnings fell 37.7% to $2.9 million from $4.7 million in the year-earlier period. Loans, though, increased to $986.3 million from $867.1 million.

“The decrease in net income comes as no surprise and is a direct reflection of our efforts to provide more value to our members in everyday savings,” Hawaii State FCU President and CEO Andrew Rosen said. “Unlike traditional banks where profits are returned to shareholders in the form of dividends, Hawaii State FCU is committed to returning profits to our members in the form of better loan rates and by paying more in deposit interest.”

Rosen said the credit union has spent more than $1 million year to date in deposit interest for its members.

Hawaii State FCU, which leads state credit unions in lending, said its membership grew 6.3% in the quarter to 108,520 members from 102,134 in the first quarter of 2018. Membership is open to all active and retired employees of the state, City and County of Honolulu and Maui County. In addition, there are more than 300 local organizations and businesses that can qualify individuals to become credit union members.

The credit union said in addition to its upcoming Salt Lake branch, it recently celebrated the grand reopening of its new Kahului Branch at the Pu‘unene Shopping Center, which is more than double the size of its former location on Maui.

Hawaii State FCU said that at the end of last year, it introduced a new high-yield savings account product, Relationship Max, which pays a 1.5% annual yield.

FIRST-QUARTER NET

$2.9 million

YEAR-EARLIER NET

$4.7 million