Sale of insurance business bolsters Evans Bank’s profits

And the Amherst-based bank is starting to put some of those proceeds to work.

Evans on Thursday reported fourth quarter net income of $10.2 million, up 70% from a year ago. That leap was powered by its November sale of the Evans Agency to Arthur J. Gallagher & Co.

For all of 2023, Evans reported net income of $24.5 million, up 10% in a year when the economy was impacted by high interest rates and persistent inflation.

“I think it was a difficult year to which we responded to the factors we faced,” said David J. Nasca, Evans’ president and CEO. “We were resilient during the year.”

The sale of the Evans Agency generated an after-tax gain of about $13 million. The bank has used part of those proceeds to restructure its investment portfolio, and has also invested in its businesses, including its Rochester operations, where the bank expanded its branch network through a 2020 acquisition. Evans hired a Rochester regional director late last year.

Selling the insurance business also strengthens Evans’ capital at a time when businesses still face challenging conditions, Nasca said.

“Having more capital in a difficult business environment is a good thing,” he said.

John Connerton, Evans’ chief financial officer, said the bank has growth in commercial real estate lending, notably from multifamily and warehouse deals meeting Evans’ credit parameters.

“I think people are a little more confident in putting money to work,” Connerton said. “They’re getting a little more situated with a little higher interest rate.”

“Consumers are still spending,” Nasca said. “They’re still powering through right now, even though they’ve had inflation” to deal with.