Webster Financial WBS reported second-quarter 2021 earnings per diluted share of $1.21, which surpassed the Zacks Consensus Estimate of $1.00. The reported figure excluded noteworthy items such as charges related to merger and strategic optimization initiatives.Growth in loan and deposit balances, as well as higher fee income supported the company. Also, a strong capital base was a tailwind during the quarter.However, elevated non-interest expenses, along with lower net interest margin (NIM), were key concerns. Additionally, decline in revenues on account of lower net interest income affected the bank’s performance. The company’s shares lost 2.05% following the earnings release most likely due to these concerns.The company reported earnings applicable to common shareholders (on GAAP basis) of $91.5 million or $1.01 per share, up from the prior-year quarter’s $50.7 million or 57 cents.Revenues Decline, Expenses Rise, Loans and Deposits ImproveWebster Financial’s total revenues in the quarter fell 3.2% year over year to $293.5 million. However, the top line topped the Zacks Consensus Estimate of $295.72 million.Net interest income edged down 1.6% year over year to $220.8 million. Additionally, NIM contracted 17 basis points (bps) to 2.2%.Non-interest income was $72.7 million, up 21% year over year. This rise mainly resulted from higher fair value adjustments, HSA fee income, deposit service fees, wealth and investment services and other income.Non-interest expenses of $18 million flared up 6% from the year-ago quarter. This upswing chiefly resulted from $18.2 million of charges related to merger and strategic optimization initiatives, partially offset by a $2-MILLION decrease in compensation and benefits.Efficiency ratio (on a non-GAAP basis) came in at 56.64% compared with 60.04% as of Jun 30, 2020. A lower ratio indicates higher profitability.The company’s total loans and leases as of Jun 30, 2021 were $21.47 billion, up marginally sequentially. However, total deposits were up 1.3% from the previous quarter to $28.85 billion.Credit Quality ImprovesTotal non-performing assets were $123.5 million as of Mar 31, 2021, down 31% from the year-ago quarter. In addition, allowance for loan losses represented 1.43% of total loans, having shrunk 21 bps from Jun 30, 2020.Furthermore, a benefit to provision for loan and lease losses of $21.5 million was recorded against the provision expense of $40 million seen in the prior-year quarter.The ratio of net recoveries to annualized average loans came in at 0.02%, as against net charge-offs to annualized average loans of 0.30% in the year-ago quarter.Capital Ratios and Profitability Ratios ImproveAs of Jun 30, 2021, Tier 1 risk-based capital ratio was 12.28% compared with 11.82% as of Jun 30, 2020. Additionally, total risk-based capital ratio was 13.68% compared with the prior-year quarter’s 13.42%. Tangible common equity ratio was 8.35%, up from 8.14%.Return on average assets was 1.12% in the reported quarter compared with the year-earlier quarter’s 0.65%. As of Jun 30, 2021, return on average common stockholders' equity was 11.63%, up from 6.79%.Our ViewpointWebster Financial’s performance was decent in the April-June quarter. Given the rise in loan and deposit balances, the company displays a strong liquidity profile. Further, the company has a robust capital position. Nonetheless, decline in revenues on lower interest income was a major drag.Webster Financial Corporation Price, Consensus and EPS Surprise Webster Financial Corporation price-consensus-eps-surprise-chart | Webster Financial Corporation QuoteCurrently, Webster Financial carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performance of Other BanksBank of America’s BAC second-quarter 2021 earnings of $1.03 per share handily beat the Zacks Consensus Estimate of 77 cents. The bottom line compared favorably with the 37 cents earned in the prior-year quarter.PNC Financial PNC delivered second-quarter 2021 earnings surprise of 42.4% on substantial reserve release. Adjusted earnings per share of $4.50 outpaced the Zacks Consensus Estimate of $3.16.Large reserve releases, solid investment banking performance and modest rise in loan demand drove JPMorgan’s JPM second-quarter 2021 earnings of $3.78 per share. The bottom line comfortably outpaced the Zacks Consensus Estimate of $3.05. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. 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