Greensburg, In. — Greensburg-based MainSource Bank has reported an increase of $4.9 million in the fourth quarter of 2017 compared to the same period in 2016.
President and Chief Executive Officer Archie Brown said, “”I am very pleased with our company’s performance for the fourth quarter and full year. We achieved record net income with operating earnings per common share of $2.12 in 2017 compared to $1.86 in 2016, a 14% increase. Our acquisition of FCB Bancorp in Louisville, Kentucky in April along with a strong net interest margin were the primary drivers of our record performance. For the quarter, we also achieved record net income of $16.6 million dollars, a 41% increase over the same quarter in 2016. On an operating earnings per share basis, we earned $.55, a 10% increase over the 4th quarter of 2016. Higher earning assets from the FCB acquisition and a strong net interest margin drove our great quarter. Our net interest margin of 3.78% was much improved from last year’s 3.69% and relatively stable with the 3rd quarter of this year. We have benefitted from the Federal Reserve’s interest rate hikes during the year as asset yields moved up much faster than our deposit costs.”
During the fourth quarter the bank had $391,000 in merger expenses and a $2.5 million income tax benefit due to recently passed federal legislation. Net interest income was $142.9 million for the full year 2017, which represents an increase of $25.3 million when compared to the twelve months ended December 31, 2016. Net interest margin, on a fully-taxable equivalent basis, increased from 3.65% in 2016 to 3.77% in 2017. During the past year the Company’s yield on earning assets has outpaced the increase in its cost of funds as the Company has been able to lag its changes in deposit rates despite the Fed rate increases. Also contributing to the increase in net interest income, average earning assets increased by $582 million in 2017 compared to 2016 as the Company realized the full year effect of the acquisition of Cheviot Financial Corp. and the partial year effect of the FCB Bancorp acquisition.
