A weak economy and low interest rates contributed to a 7.3% drop in net income at Damariscotta-based The First Bancorp, the bank holding company reported yesterday. Its net income for the quarter ended March 31 was $2.9 million, down $230,000 from the same period last year.
President and CEO Daniel Daigneault in a press release said the economy has led to higher credit losses and that extremely low interest rates have compressed margins and lowered net interest income. Net interest income dropped 4.9% compared to the same quarter in 2011. Non-interest income also fell due to a decline in mortgage origination income. Employment levels and housing prices have also affected the bank's credit quality, according to the release.
Total assets increased $50.9 million, or 3.7%, during the quarter. Daigneault said he was pleased the bank's quarterly results have been consistent over the past two years.