MidWestOne Financial Group, corporate parent of MidWestOne Bank in Iowa City, reported higher third-quarter profit on an increase in non-interest income.
Net income for the quarter that ended on Sept. 30 rose to $4.9 million, or 57 cents per share, compared with $4.2 million, or 50 cents per share, for the same quarter of 2012. Net income for the third quarter of 2013 was 14.8 percent higher than the same period in 2012, primarily due to a 16.6 percent increase in non-interest income.
The latter rose due to a $200,000 increase in mortgage origination and mortgage servicing fees, driven by a $500,000 increase in the fair value of retained mortgage servicing rights.
MidWestOne Financial also recorded a $300,000 impairment loss on investment securities in the third quarter of 2012, for which no comparable loss was recorded in the most recent quarter. The financial holding company said non-interest expense declined by 4 percent, which was partially offset by a 3.3 percent decrease in net interest income.
Charles Funk, MidWestOne president and chief executive officer, said the third quarter of 2013 was the best quarter in terms of earnings per share since the 2008 merger of ISB Financial and MidWestOne Financial.
“We very clearly received a large boost from the mortgage servicing rights adjustment to income during the quarter, which we do not expect to see repeated,” Funk said. “We continued to post solid loan growth, good wealth management fee income increases and our expense control remains very good.”