Citing weak loan demand and a decline in interest income, Blackhawk Bancorp of Beloit, the parent company of Blackhawk Bank, reported net income of $731,000 in the fourth quarter of 2011, a decline of 18% from the $886,000 reported in same quarter in 2010. Blackhawk said earnings per share for the quarter decreased 21%, to 26 cents per share, compared to the 33 cents per share in the same three-month period last year.
For the year, Blackhawk reported net income of $2.4 million, a 20% decrease compared to $3.03 million earned in 2010, and earnings per share for the full year decreased 26%, to 81 cents per share, compared to the $1.10 per share earned in 2010.
President and CEO Rick Bastian said in a press release that the decrease in earnings for both the quarter and full year reflect the economic realities of the market. “Weak loan demand and intense competition for qualified borrowers has compressed net interest income,” Bastian said. “Earnings continue to be negatively impacted by elevated credit losses from businesses and consumers hurt by the tough economy and depressed real estate values.”
Net interest income for the fourth quarter decreased from $5.23 million to $4.85 million, a drop of 7%, while full year net interest income was down 3% to $19.1 million, compared to $19.8 million for 2010.
The provision for loan losses in the fourth quarter increased by 44% to $1.6 million, compared to $1.1 million in fourth quarter 2010; for the year, the bank reported a provision for loan losses of $4.8 million, a 6% increase over the $4.5 million provision recorded in 2010.
Loans charged off in 2011 totaled $4 million, up from $3.9 million in 2010. The ratio of allowance for loan losses to total loans was 2.05% at Dec. 31, 2011 compared to 1.82% at Dec. 31, 2010.
Blackhawk also said total assets increased to $559.3 million as of Dec. 31, 2011, up from the $539.9 million reported at the end of 2010.
