July 18, 2012 / 7:06 PM / 7 years ago

MB Financial expects lower margins in third quarter

(Reuters) - MB Financial Inc MBFI.O, the holding company for MB Financial Bank, said it expects third-quarter net interest margin to reduce from the second quarter, as loan growth remains muted, sending its shares down nearly 9 percent.

Margins at banks have been pressured, as the Federal Reserve plans to keep interest rates at record lows at least for the next two years because of a stuttering recovery and high unemployment rates.

Net interest margin - the difference between what banks pay on deposits and what it earns on loans - fell to 3.59 percent in the second quarter from 3.79 percent a year ago.

The bank on Tuesday reported net income of $22.1 million, or 41 cents per share, compared with a net loss of $7.4 million, or 14 cents per share, last year.

MB Financial had no provision for credit losses in the quarter.

The company’s shares were trading down almost 7 percent at $20.81 on Wednesday afternoon on the Nasdaq. (Reporting by Sharanya Hrishikesh in Bangalore; Editing by Viraj Nair)

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