Bermuda Commercial Bank (BCB) reported net income of $4.39 million for the six-month period ended March 31.

It was an increase of $1.6 million compared to the $2.79 million reported last year.

Diluted earnings per share increased to 75 cents per share compared to 52 cents per share one year ago. Total revenue for the period was $8.99 million compared to $7.8 million in the prior period.

Net interest income during the period was $5.43 million compared to $5.03 million for the same period last year. This increase results from the year-on-year growth in client deposit levels more than offsetting the continued reduction in US interest rates. Looking forward, the bank anticipates a reduction in net interest income in the second half of fiscal 2008 in line with reduced average interest rate levels.

Fee and other income increased by $790,000 to $3.56 million. This increase resulted primarily from $740,000 in one-time gains associated with the Visa and MasterCard IPOs. Additionally, increases in foreign exchange and custody income marginally outpaced a reduction in fund administration revenues.

Total expenses for the six month period were $4.6 million compared to $5.01 million for the prior year period, a decrease of $410,000 or 8.2 percent. The 2007 figure includes $500,000 of non recurring expenses relating to the sale process compared with $110,000 in 2008. Excluding these one-time costs, total expenses were almost exactly in line with the prior period.

BCB's balance sheet continues to strengthen. Total assets grew from $621.55 million at September 30, 2007 to $696.45 million at March 31, 2008, an increase of 12.1 percent. Total assets at March 31, 2007 were $583.18 million. This growth was driven by corresponding increases in client deposits. BCB's long term policy of limiting its investments to cash and cash equivalents ensures that the bank has no exposure to the current sub-prime issues.

The board has approved a semi-annual dividend of 40 cents per share to shareholders of record as of May 14, 2008. This represents an annual yield of eight percent based on the current market value of $10 for the bank's common stock.