Suffolk Bancorp, parent company of Suffolk County National Bank, this week reported net income of $17.7 million in 2015, an increase of more than 30 percent over its net income in 2014.
The Riverhead-based company also announced this week that its board of directors had declared a quarterly cash dividend of 10 cents per share on its common stock. The dividend will be payable on February 24, to shareholders of record as of February 10.
Suffolk Bancorp also reported fourth quarter earnings of $3.6 million, compared to $4.1 million in the fourth quarter of $4.1 million. The company said its fourth quarter net income this year would have been $4.7 million excluding the after-tax impact of a systems conversion expense of $1.4 million to terminate existing technology contracts.
“I am pleased to report another excellent quarter,” Suffolk Bancorp president and CEO Howard Bluver said in a Jan. 28 press release announcing the results. “The successful expansion strategies we have put in place over the last several years are clearly translating into both impressive growth and strong financial results,” he said.
The bank’s lending businesses performed “exceedingly well” in 2015, Bluver said, with total loans increasing 22.9 percent over 2014. The company’s loan pipeline is “robust” and Bluver said he is optimistic about the prospects for continued strong loan growth.
“It is very gratifying to see that our core growth strategy of protecting and enhancing our traditional markets on the East End of Long Island while simultaneously expanding west is working exactly as envisioned,” he said. “Both markets are contributing substantially to our results.”
The bank’s total deposits grew by $225 million or 14.4 percent in 2015, to $1.781 billion as of Dec. 31.
Credit quality remains strong and improved dramatically both in the fourth quarter and throughout 2015, Bluver said.
“Finally, we continue to be vigilant in controlling operating expenses, while also making smart investments that will generate both revenue increases and operating efficiencies over time,” Bluver said. The core operating systems conversion, for which the company recorded a $1.4 million expense in the fourth quarter, largely for payments to terminate existing contracts with current providers, is “a prime example of making smart investments for the future,” the CEO said.
Bluver was hired in 2012 to turn things around at Suffolk Bancorp, which in 2010 had been determined by federal regulators to be in “troubled condition” and in 2011 was threatened with delisting by NASDAQ for failing to meet SEC filing deadlines as it re-examined its financial records.
Bluver’s hiring was part of a major shakeup at the bank’s upper management level. In 2011 and 2012 Suffolk Bancorp, in addition to replacing its president and chief executive officer, named a new chief lending officer, a new chief financial officer, a new chief information officer, and new heads of its loan administration and residential lending departments.
The bank had to issue restated results of operations for the third quarter of 2010 and for the year ending Dec. 31, 2010, for which it posted a net income of $6.26 million, down more than 72 percent compared to its net income for 2009. It posted a net loss of $7.57 million in the first quarter of 2011. Though it returned to profitability during subsequent quarters of 2011, it still posted a net loss of $76,000 for the year, down more than 100 percent compared to its restated results for 2010.
Suffolk Bancorp’s condition turned around in 2012 and in May 2013, the Office of the Comptroller of the Currency released the company from its formal written oversight agreement entered into on Oct. 25, 2010.
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