American Savings Bank said Tuesday its net income for the second quarter was up 12 percent to $15.9 million, compared with $14.2 million in the second quarter of 2012.

"American delivered solid results in the second quarter as good loan growth helped us offset the continued pressure of the low interest rate environment," said Richard Wacker, the bank’s president and CEO, in a statement. "We experienced very low credit costs in the quarter thanks to good risk management systems and the positive trends in the Hawaii economy."

The bank said the increase in net income was also due to the planned third-quarter sale of its credit card portfolio and gains on sales of investment securities.

American Savings Bank, Hawaii’s third largest, had $5 billion in assets as of June 30, up 2.1 percent from $4.9 billion a year earlier. ASB is a subsidiary of Hawaiian Electric Industries Inc.

The bank said its loan portfolio grew in the quarter primarily due to an increase in residential mortgages. Over the previous year its loan portfolio grew by 5.8 percent to $3.96 billion.

ASB said it was able to reduce the amount set aside for potential loan losses enough to add $1 million to its bottom line. That contrasts with the second quarter of 2012 when the bank’s increasing provisions for loan losses reduced its profit by $2.4 million.

The bank said the agreement to sell its credit card portfolio enabled it to release $1 million of loan loss reserves.

ASB bank said nonperforming loans, those delinquent 90 days or more, equaled 1.56 percent of all loans, down from 1.84 percent in the second quarter of 2012.