Central Pacific Financial Corp., which two years ago was fighting for survival, boosted earnings 31.7 percent in the April-June period to post its sixth consecutive profitable quarter.

The parent of Central Pacific Bank, the state’s fourth largest with $4.23 billion in assets, had second-quarter net income of $10.8 million, or 26 cents a share, compared with $8.2 million, or 20 cents a share, a year ago, the bank said in a report due out today.

Shares rose 2 cents to $13.07 on Wednesday.

Central Pacific, which has been aggressively overhauling its troubled mainland loan portfolio, bolstered its earnings by adding $6.6 million to income that had been set aside for potential loan losses. It was the sixth straight quarter that Central Pacific reduced the money it has set aside for loan losses.

"With a meaningful reduction in our nonperforming assets, the improvement in our credit risk profile allowed us to once again reduce our allowance for loan and lease losses, which contributed significantly to our profitable quarter," Central Pacific President and CEO John Dean said.

But Dean expressed concern with the bank’s 80.41 percent efficiency ratio, a number that measures in percentage terms how much it costs the bank to make a dollar of revenue. At 80.41 cents, Central Pacific’s efficiency ratio is considerably higher than the state’s two largest banks, First Hawaiian Bank at 42.9 cents and Bank of Hawaii at 56.77 cents.

"We’ve made significant progress in growing earnings, but if you look at our efficiency ratio, we certainly have the opportunity to improve," Dean said.

One of the ways he’s seeking to do that is by increasing revenue through loan growth, which in the second quarter was up 2.7 percent to $2.1 billion. Deposits, meanwhile, jumped 10.3 percent to $3.56 billion.

"When you look at total loans, it includes nonperforming loans, so the better we do in reducing our nonperformers also reduces our total loan portfolio," Dean said. "We’ve actually had good growth because we’ve not only replaced the nonperformers with good loans, we’ve also grown the total loan portfolio. And if you look at the second quarter, we significantly reduced our nonperforming assets by $35.3 million."

Nonperforming assets — or loans delinquent 90 days or more — fell to $170.3 million, or 4.03 percent of total assets, from $205.6 million, or 4.94 percent of total assets, in the first quarter. In the second quarter of 2011, nonperforming assets were $249.3 million, or 6 percent of total assets. Two years ago, the bank’s nonperforming assets were roughly $500 million.

Dean said the economic uncertainty in the state, on the mainland and abroad has deterred businesses from taking out loans for expansion.

"There isn’t the demand in the market for the amount of credit that’s available to the market," Dean said. "All the Hawaii banks have the ability to lend more than they’re lending today, ourselves included. It has nothing to do with banks not being willing to lend or lending standards having been tightened. There’s not the construction, which is one of the engines for capital investment in this market."

Central Pacific began its profitability streak after seven straight losing quarters and following a $325 million recapitalization in February 2011 from private equity funds and investors. That was preceded in January 2009 by a $135 million bailout from the U.S. Treasury through the Troubled Asset Relief Program, or TARP, that bought the bank additional time until it could recapitalize itself. The Treasury, which received stock in the bank in exchange for its investment, ended up selling those shares for a $63.1 million loss.

The bank now has $103.8 million in its loan-loss reserve, or 4.94 percent of total loans and leases. That’s down from $167 million, or 8.16 percent of total loans and leases, a year ago, and lower than $114.3 million, or 5.49 percent of total loans and leases, in the first quarter.