CORTLAND - Cortland Bancorp reported a drop in first-quarter earnings to $830,000 from $1.2 million for the first quarter a year ago.
First-quarter price per share is reported at 18 cents compared to 26 cents per share at this time last year. The bank reported total assets of $546.5 million, an increase of 7.5 percent from year-ago asset totals of $508.4 million with loans providing the core growth.
"As anticipated, interest rates continue to persist at historical lows, resulting in a continued compression of our net interest margin and a parallel decrease in net income," said President and Chief Executive Officer James Gasior in a statement released after the markets closed Tuesday.
With no upward movement in interest rates over the last several years and minimal improvement, if any, expected in the foreseeable future, a significant source of revenues for banks continues to dry out, Gasior said.
Recognizing a need to diversify revenue through additional sources of non-interest fee income, Gasior said, "The company's investment in fee-based businesses designed to generate revenues to complement sources of interest income from core operations has begun to produce the desired results."
Total non-interest income improved from $695,000 for the March 31, 2012, quarter to $1.31 million for the most recent March 31, 2013 quarter.
"Continued expansion of the mortgage banking and wealth management businesses is expected to provide additional revenue opportunities, further compensating for compression in the net interest margins," Gasior said.