Entegra Financial Corp., which operates banks in western North Carolina, South Carolina and north Georgia, reported fourth-quarter earnings per share that beat analyst expectations despite a decline in net interest margin.

The Franklin, North Carolina-based company reported net income of $3.7 million, or 54 cents per share, in the fourth quarter of 2018, compared to net loss of $3.3 million, or 48 cents per share a year ago. Analysts expected the bank to report earnings of 50 cents per share.

However, the quarterly results included approximately 5 cents per share of life insurance benefits and expense reversals. The net interest margin actually deteriorated by 32 basis points over the fourth quarter of 2017 to 3.29 percent.

Despite the declining net interest margin, CEO Roger Plemens was still optimistic about the future earnings, following a proposed merger with SmartFinancial Inc.

“We are looking forward to the proposed merger of equals announced Jan. 15, 2019, and will work diligently with the Smart Bank team over the next several months to ensure the combination of management and culture will follow our history of successful integrations,” Plemens said.

The company’s stock fell 8 cents, or 0.36 percent, to $22.02 on Thursday.

Net interest income decreased 2.8 percent, to $12.3 million for the three months ended Dec. 31, compared to $12.7 million for the same period in 2017.

Noninterest income increased 87.6 percent to $1.3 million for the fourth quarter compared to $700,000 for the same period in 2017.

Its subsidiary Entegra Bank operates 18 branches located throughout the western North Carolina counties of Cherokee, Haywood, Henderson, Jackson, Macon, Polk and Transylvania, the upstate South Carolina counties of Anderson, Greenville, and Spartanburg and the northern Georgia counties of Pickens and Hall.

The bank also operates loan production offices in Asheville, North Carolina, and Clemson, South Carolina.

The filing can be found here.