Published April 25. 2013 11:00AM Updated April 25. 2013 11:27AM
Groton — Chelsea Groton Bank released an annual report Thursday that revealed the financial institution’s profits grew 29 percent in 2012 compared with the previous year.
“Last year was really phenomenal,” bank President and Chief Executive Officer Michael Rauh said this morning during an interview at his office off Poquonnock Road.
Net income last year stood at $4.1 million, a $1 million increase from the year before. What’s more, according to Rauh, new loans increased 47 percent during the year. A big rise in mortgage activity -- particularly among homebuyers versus refinancers -- helped spur the lending jump, Rauh said.
At the same time, the bank saw a “huge decrease” in bad loans, he said, resulting in a more than $400,000 reduction in money set aside for possible losses.
While certificates of deposit were down slightly during the year, savings and checking deposits more than made up for it. Total deposits increased nearly $40 million over the year.
Noninterest income also was up significantly -- from $1.2 million to $1.6 million -- as many of the mortgages were sold to other servicers. Overall, according to Rauh, Chelsea Groton was the No. 2 mortgage originator in New London County, but it was No. 1 when it came to home-purchase loans.
Other areas of growth included financial services, which saw a 12 percent increase in money managed. Rauh said most of the boost represented new business.
“There’s a definite trend toward people looking for a local relationship at a local bank,” Rauh said.
Financial results are expected to be released officially later today when Chelsea Groton officials meet at the Mystic Marriott. At the meeting, three new corporators are expected to be appointed: Lynn Malerba, chief of the Mohegan Tribe; Daniel R. Dennis Jr., former president of Norwich Savings Society, and Robert W. Tabor, retired senior vice president at Chelsea Groton.