Sacramento’s River City Bank reported lower quarterly earnings Wednesday, the result of a loss on financial instruments known as interest rate swaps.
The company said second-quarter earnings fell to $3.3 million from $3.9 million a year earlier. Per-share earnings dropped to $2.30 from $2.71.
River City’s total interest income grew to $12.4 million from $10.2 million, and its total asset base improved to $1.63 billion from $1.52 billion.
However, the bank took a $686,000 loss on its interest rate swaps – contracts in which the bank agreed to swap its interest cash flows with other parties. The loss occurred when long-term interest rates dipped in the first half of the year.