City National Corp. late Thursday reported better-than-expected net income in the second quarter, boosted by higher revenue growth and credit quality.
After the markets closed, the Los Angeles holding company for City National Bank reported net income of $41.3 million (78 cents a share), compared with $1.3 million (2 cents) a year earlier.
Revenue rose 39 percent to more than $304 million. Net interest income was up 17 percent to more than $185 million, while non-interest income jumped 91 percent to more than $122 million.
Excluding one-time items related to recent acquisitions and the favorable settlement of tax litigation, adjusted net income was $30 million (56 cents). Analysts surveyed by Thomson Reuters on average expected adjusted per-share profit of 49 cents on revenue of nearly $253 million.
City National’s provision for credit losses fell to $32 million from $70 million a year earlier. The company also said it expects significantly better profitability this year compared with last year, when the bank was part of the federal TARP program. During the quarter, it acquired the assets of two banks closed by the regulators, which expanded its presence in Nevada and San Diego.
"City National's performance improved significantly in the second quarter, thanks in part to continued strong deposit and revenue growth and further improvement in credit quality," Chief Executive Officer Russell Goldsmith said in a statement.
Shares were up $2.32, or 4 percent, to $53.32 in midday trading on the New York Stock Exchange.
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