Bank of Marin Bancorp (NASDAQ:BMRC) Q3 2019 Earnings Conference Call - Final Transcript
Oct 21, 2019 • 11:30 am ET
Good morning and thank you for joining Bank of Marin Bancorp's Earnings Call for the Third Quarter Ended September 30th, 2019. I'm Andrea Henderson, Director of Marketing for Bank of Marin. [Operator Instructions] As a reminder, this conference is being recorded on October 21, 2019.
Joining us on the call today are Russ Colombo, President and CEO; and Tani Girton, Executive Vice President and Chief Financial Officer. Our earnings press release which we issued this morning can be found on our website at bankofmarin.com, where this call is also being webcast.
Before we get started, I want to emphasize that the discussion on this call is based on information we know as of today, October 21, 2019, and may contain forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those set forth in such statements. For a discussion of these risks and uncertainties, please review the forward-looking statements disclosure in our earnings press release as well as our SEC filings. Following our prepared remarks, Russ and Tani will be available to answer your questions.
And now, I'd like to turn the call over to Russ Colombo.
Russell A. Colombo
Thank you, Andrea. Good morning, welcome to the call. By any measure, our third quarter performance was once again excellent. We produced strong deposit and loan growth, while maintaining exceptional credit quality. These results demonstrate the success of our organic growth initiatives and our discipline in the way we operate. The investments we've made in banking account [Phonetic] are driving consistent loan growth and enhancing our reputation across the footprint. Our business development activity is strong across our Bay Area markets, Marin, Sonoma, Napa, the East Bay and San Francisco, and we have a strong pipeline of new opportunities to fuel continued growth.
Now, I'll walk you through some of the highlights of the third quarter. Net income was $9.4 million, up from $8.2 million in the second quarter and $8.7 million in the third quarter of 2018. Diluted earnings per share was $0.69 in the third quarter of 2019, compared to $0.60 last quarter and $0.62 in the year ago quarter, after adjusting for the two-for-one stock split last November. Loan originations increased to $77 million in the quarter from $53 million a year ago. This drove $33 million -- $33.8 million of loan growth for the quarter, resulting in total loans of $1.8 billion at September 30th. Deposits increased to -- increased $122.5 million in the third quarter, primarily due to normal cash fluctuations in some of our large business accounts and total deposits were $2.22 billion at quarter end.
At September 30, non-interest bearing deposits accounted for 50% of total deposits and our cost of deposits remained very low at only 21 basis points for the quarter. We have been at or near these level since the beginning of 2018, making our deposit franchise one of the strongest among our peers. Our credit quality remains excellent, non-accrual loans declined to only 0.02% of the total loan portfolio at