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Lake Shore Savings Bank’s parent company reported an 11 percent drop in profits in the second quarter from a year ago.

Dunkirk-based Lake Shore Bancorp’s net income was $800,000, down from $895,000 a year ago. Its diluted net income per share was 14 cents, compared with 16 cents in the second quarter of 2012.

Despite the drop in profits, President and CEO Daniel P. Reininga said in a statement that Lake Shore “once again delivered a solid operating performance in a challenging economic environment which continues to improve slowly.”

Lake Shore in the second half of the year will be focused on “maintaining an efficient operating profile, driving growth in our commercial loan portfolio, and identifying and managing institutional risk,” Reininga said.

Net interest income from taking deposits and making loans was $3.7 million in the second quarter, compared with $3.8 million a year ago. The drop-off was due mainly to lower interest income from its securities portfolio and loan portfolio, the bank said.

Noninterest income increased 13 percent from a year ago, to $515,000. That figure included a noncash, pretax impairment charge of $57,000 related to the bank’s write-down of an asset-backed security.

The bank’s noninterest expenses increased 7.1 percent from a year ago, to $3.3 million. It opened a branch in Snyder in April, and the higher costs reflected increased advertising, occupancy and equipment costs. It also incurred higher salary and benefit expense and professional service costs in the quarter.

email: mglynn@buffnews.com