An acquisition last fall helped ChoiceOne Financial Services Inc. report quarterly earnings that tripled from a year ago.
The Sparta-based ChoiceOne (Nasdaq: COFS) Tuesday afternoon reported $4.4 million for the second quarter, or 61 cents per diluted share. That compares to $1.4 million in quarterly net income in the same period in 2019, or 45 cents per diluted share.
In October, ChoiceOne closed on the $21.9 million acquisition of Lapeer-based County Bank Corp., the parent company of Lakestone Bank & Trust. The corporation attributed the earnings growth largely to the acquisition, which generated $462,000 in merger-related expenses in the quarter.
ChoiceOne subsequently acquired Muskegon-based Community Shores Bank Corp. in a $20.8 million deal that closed in May. Community Shores’ three offices in Muskegon County and one in Grand Haven in neighboring Ottawa County will integrate into ChoiceOne Bank later this year.
Closing on the Community Shores acquisition and the second quarter performance came amid what ChoiceOne President and CEO Kelly Potes called “unprecedented times in our world” with the COVID-19 pandemic.
“These are certainly unusual times for our country, our state and our banks,” Potes said. “We believe our recent mergers have given us the increased size and scale to move through these unprecedented times with the ability to continue our pursuit for efficiencies and new growth opportunities in our expanded network across West and Southeast Michigan.”
Like most banks in the second quarter, ChoiceOne significantly increased its quarterly loan-loss provision, which grew by $1 million from a year earlier. Much of the loan-loss provision increase “was related to the impact of COVID-19,” the bank said.
“Although ChoiceOne has not seen significant increases in charge-offs or delinquencies, we are continuing to monitor deferrals and economic indicators which may signify the need for increased provision for loan losses expense,” the bank said in an earnings release.
Mid-year net income totaled $7.6 million, or $1.06 per diluted share, versus $3.1 million, or 86 cents per diluted share, for the first six months of 2019.
ChoiceOne has 33 offices in West and Southeast Michigan with $1.54 billion in total assets as of June 30.