Square 1 Banks profit more than doubled in the first quarter, thanks to across-the-board gains and a spike in income gained from warrants it received when making loans to startups.
The Durham-based specialty bank posted net income of $7.8 million, or 31 cents per share, up 137 percent from a year earlier.
We are pleased with our results from the first quarter, CEO Douglas Bowers said during a conference call the companys first as a publicly traded company. Square 1 is off to a very good start for 2014.
Square 1 went public at $18 per share last month. Its shares closed Wednesday at $18.85, up 19 cents.
Square 1 provides loans and other banking services to venture capital firms and the businesses they invest in. It has a dozen offices nationwide.
Our growth in loans, deposits and investments helped...net-interest income increase nearly 36 percent over the same period of last year, Bowers said. Average loan balances in the quarter rose 30 percent to $1.1 billion.
Noninterest income rose 77 percent to $7.1 million. That included $2.2 million in warrant income, up from a $227,000 loss a year ago.
Bowers noted that warrant income can be unpredictable.
We had a big quarter of warrant income as six of the companies we held warrant positions in experienced successful IPOs, he said.