Kitsap Bank achieved record earnings for the third quarter and for the nine months ending Sept. 30.

Earnings of $2.5 million were achieved for the quarter, while earnings for the year were $7.3 million, compared to $6.2 million for 2001. This was an 18 percent increase over the prior year’s earnings. The return on assets was 2.1 percent compared to 1.9 percent in 2001 and the return on equity increased to 19 percent. The primary factors for the record profits were strong commercial loan growth, including substantial SBA loan growth, a significant increase in mortgage lending activity, and a reduction in expenses.

Commercial loans increased $32 million for the past year. Total loans have now reached $381 million. In addition, the bank has closed $120 million in residential mortgage loans this year. This set a record for residential mortgage lending at Kitsap Bank. The total assets of the bank, founding in 1908, have not reached $477 million, with Kitsap Bank operating 26 offices in Kitsap, King, Clallam, Pierce and Mason counties.