Strong loan growth particularly in California’s smoldering real estate market helped City National Corp. post an 11 percent jump in second-quarter profits.
Chief Executive Russell Goldsmith credited the bank’s double-digit revenue and income growth to California’s solid economy. Average loans rose 9 percent in the second quarter to $8.8 billion, reflecting growth in both commercial lending and real estate loans.
“City National performed well in the second quarter,” Goldsmith said in a statement. “Double-digit revenue, income and EPS growth primarily reflect encouraging growth in loans and net interest income.”
City National, the parent of City National Bank in Beverly Hills, reported net income of $57.7 million ($1.13 per diluted share) for the second quarter ended June 28, compared with $52.2 million ($1.03) in the like period a year ago.
Net interest income rose 13 percent in the quarter to $152.7 million even though the bank’s net interest margin fell slightly because average loans grew faster than average deposits, and the yield on its securities portfolio also dropped.