Bank sees profits drop nearly $ 28 million in 2020
BISMARCK, ND (KFYR) – The Bank of North Dakota made less money in 2020 for a variety of reasons.
Despite this, Bank President Eric Hardmeyer said the overall performance was outstanding.
The Bank of North Dakota reported a profit of $ 141.2 million, down from the $ 169 million made in 2019.
Hardmeyer says several factors contributed to the nearly $ 28 million drop in profits, including the Federal Reserve lowering interest rates.
“This has led to what we call business compression, which means that our assets, we are priced much lower than our deposits in terms of spread. And that had an impact on profits, ”said Hardmeyer.
Hardmeyer also says it’s because more money has been set aside in the allowance for loan losses.
“Lots of problems in a few sectors affected by COVID, particularly the hospitality service industries. So we are putting more money aside in case we have losses on any part of this portfolio, ”said Hardmeyer.
Last year, the bank’s total loan portfolio edged up to $ 4.7 billion.
The farm loan portfolio increased by $ 116 million due to the agricultural disaster relief program, and the business loan portfolio increased by $ 194 million, due to growth from COVID-PACE loans Recovery I.
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