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January 17, 2020

Loan income drives People’s United’s Q4 profits higher

HBJ Photo | Joe Cooper Buffalo’s M&T Bank announced it would buy Bridgeport-based People’s United Bank.
By Matt Pilon

People’s United Financial saw its profits rise 3.6 percent in the fourth quarter, fueled mainly by interest earned on its newly enlarged loan portfolio, following its $759 million acquisition of Hartford-based rival United Bank.

People’s United, the parent of Bridgeport-based regional lender People’s United Bank, reported profits of $134 million, or 31 cents per diluted share, for the quarter ended Dec. 31, compared to $129.4 million, or 35 cents per share, in the final quarter of 2018.

The largest driver of that increase was higher net interest income, which grew by $50.1 million, or nearly 12 percent. Those gains were concentrated in the bank’s commercial real estate and commercial-industrial loans.

People’s United’s total loan portfolio has grown from $35.24 billion in the fourth quarter of last year (the first People’s United earnings report to include its $544 million Farmington Bank acquisition) to $43.6 billion as of year-end 2019. Most of that growth is due to the United Bank acquisition, but People’s United said it also posted $344 million in organic loan growth between the third and fourth quarters.

Meanwhile, non-interest income, like service charges and fees, was up $35.5 million from a year ago. People’s United also reported a net gain of $7.6 million on the sale of branches.

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