(RTTNews) - Prosperity Bancshares, Inc. (PRSP: News ), the parent company of Prosperity Bank, Friday reported that its profit for the third quarter surged from last year, helped by strong growth in net interest and non interest income.

Third-quarter net income was $29.32 million or $0.63 per share, compared to $15.45 million or $0.33 per share last year. Excluding prior year's impairment charge, third-quarter net income grew 19.4% from $24.56 million or $0.53 per share reported a year ago.

On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $0.61 per share for the quarter. Analysts' estimates typically exclude special items.

Total interest income was $101.70 million in the quarter, higher than $84.85 million in the prior year. Net interest income, before provision for credit losses, rose 33.9% to $77.41 million from $57.81 million in the prior year quarter, attributable primarily to a 35.7% increase in average earning assets mainly due to the assumption of certain deposits and acquisition of certain assets of Franklin Bank from the FDIC. The net interest margin on a tax equivalent basis decreased to 4.08% from 4.15% for the same period in 2008.

Provision for credit losses was $7.25 million for the quarter, higher than last year's $1.70 million.

Total non-interest income increased 16.2% to $15.24 million from $13.12 million in the same period a year earlier, mainly driven by an increase in service charges on deposit accounts related to accounts assumed from the FDIC as part of the Franklin Bank transaction.
Non-interest expense in the quarter fell 10.9% to $41.20 million from prior year's $46.23 million.

Commenting on the results, David Zalman, Chairman and Chief Executive Officer, said, "Our bankers are competing well in all of our markets and we continue to believe our strong asset quality and strong earnings capacity will lead to future opportunities. We continued to reduce our exposure to construction and development loans while our team of professional bankers continued to attract core deposit customers in our market areas throughout Texas. While Texas is certainly not immune to the economic ills affecting other parts of the country, we are encouraged by the resilience of the Texas economy."

For the nine months ended September 30, the company's net income was $81.31 million or $1.76 per share, compared to $61.82 million or $1.37 per share a year ago. Net interest income before provision for credit losses increased 38.6% to $227.01 million from $163.77 million in 2008, mainly on a 40.5% increase in average earning assets. Non-interest income grew 16.8% to $45.39 million from $38.86 million last year.

To receive FREE breaking news email alerts for Prosperity Bancshares Inc. and others in your portfolio

 1   2   Next Page