MainSource grows net income in first quarter

MainSource Financial Group has reported net income of $12.1 million, or 49 cents per common share, for the first quarter of 2017.

That compares to net income of $8.8 million, or 40 cents per common share, in the first quarter of 2016, the Greensburg-based company said.

Earnings per common share increased by 23 percent from a year ago as the company continues to benefit from its Cheviot Financial Corp. acquisition that closed in May 2016 and organic loan growth over the past year, said Archie M. Brown, MainSource president and chief executive officer.

Net interest income was $32.3 million for the first quarter of 2017 compared to $26.4 million a year ago. Non-interest income was $13 million for the first quarter of this year, compared to $11.6 million for the same period in 2016.

Total assets were $4 billion as of March 31, which represents a $628 million increase from a year ago, the company said.

During the first quarter of 2017, MainSource recorded $274,000 in reduced income tax expense related to accounting for stock-based compensation, the company said.

Brown said the company was disappointed with a decline in loan balances for the quarter, saying seasonal reductions in revolving lines of credit and reductions in criticized assets placed pressure on loan balances.

During the first quarter, MainSource also experienced a higher-than-normal level of mortgage payoffs, Brown said.

“Commercial loan originations were similar to the first quarter of last year, but were softer than we expected,” Brown said. “We are optimistic that origination activity will pick up in the second quarter and that we will return to growth in balances.”

Also during the first quarter, MainSource completed the acquisition of the assets of First Service Capital Management, Inc., a Raymond James brokerage agency, with about $160 million in assets under management, located in Elizabethtown, Kentucky.

The company also recently received regulatory approval for a pending merger with FCB Bancorp, Louisville, Kentucky. That merger is expected to be completed in the second quarter of this year, Brown said.

MainSource has local offices in Columbus, Hope, Edinburgh, North Vernon and Westport, in addition to locations inside retail stores and ATM locations.