iStock illustration
New Canaan-based Bankwell Financial Group had first quarter net income of $10.4 million, or $1.33 per share, compared to $8.2 million, or $1.04 per share, in the first quarter of 2022.
The bank in its first quarter earnings statement said it saw revenue growth during the quarter in part from loan growth and higher overall loan yields.
“Bankwell delivered excellent results this quarter,” Christopher Gruseke, Bankwell’s president and CEO, said in the first quarter earnings statement. “Against the backdrop of a turbulent banking environment, we have maintained strong capital and liquidity levels. Our disciplined risk management practices have maintained outstanding credit quality and have protected the Bank’s capital against rising interest rates. We have previously acknowledged and planned for the current environment of increased pressure on deposit costs, and can reiterate prior guidance for a year over year decline in Net Interest Income of approximately 10 percent for fiscal year 2023.”
Bankwell’s net interest margin in the first quarter was 3.24 percent compared to 3.30 percent in the first quarter of 2022. The bank said the decrease in the net interest margin was due to an increase in funding costs that was partially offset by an increase in overall loan yields.
The bank’s provision for credit losses was $826,000 in the first quarter.
Bankwell, like other banks that had not already done so, adopted the current expected credit losses (CECL) accounting methodology on Jan. 1. The bank increased its allowance for credit losses by $5.1 million and made a $1.3 million adjustment for unfunded commitments
Bankwell’s assets totaled $3.25 billion on March 31 and were unchanged compared to Dec. 31. Total loans were $2.8 billion, an increase of $83.8 million, or 3.1 percent, from the end of 2022.
Deposits totaled $2.8 billion at the end of the first quarter and were unchanged from Dec. 31. The bank said $2 billion in deposits were FDIC-insured, representing 70.3 percent of total deposits.
Bankwell said it had immediately available liquidity to cover 200 percent of uninsured deposits. This liquidity, which totaled $1.5 billion, included cash, available-for-sale securities and borrowing capacity with the Federal Home Loan Bank of Boston and the Federal Reserve, the bank said.
