Reflecting state economy, banks less profitable in 1Q
By Rhonda J. Miller PBN Staff Writer
Two Rhode Island banks posted a higher return on assets than the national average for the first quarter of 2014, according to the Federal Deposit Insurance Corp.’s Quarterly Banking Profile.
North Providence-based Union Federal Savings Bank topped the list of state banks in ROA with 3.98 percent for the first quarter of the year, according to the FDIC figures. The bank’s ROA for first quarter of 2013 was 0.77 percent, compared with 0.41 percent in the first quarter of 2012.
Union Federal was acquired in 2006 by Boston-based First Marblehead, a leading provider of private student loans.
Westerly-based The Washington Trust Co. ranked second in the state in ROA for the first quarter of the year at 1.19 percent. That compares with the bank’s ROA of 1 percent in 2013 and 1.14 percent in 2012.
Although the two banks differ widely in size – Union Federal has one branch and Washington Trust recently opened its 19th branch – the return on assets may be used statewide and nationally as one comparative measure of banks’ profitability.
Neither Union Federal Savings nor First Marblehead had a spokesperson available to comment on the rankings.
Nationally, the average return on assets was 1.01 percent in the first quarter of 2014, down from 1.12 percent in the same quarter the previous year, according to the FDIC.
Statewide, the aggregate return on assets was 0.60 percent for the first quarter of the year, down slightly from 0.66 for the same period in 2013.
Coming in third among the 10 Rhode Island-based banks for return on assets was Providence-based Bank Rhode Island, with ROA of 0.93 percent; East Greenwich-based Independence Bank was fourth with ROA of 0.65 percent; and BankNewport fifth with ROA of 0.58 percent.