First Capital Bancorp, Inc., the bank holding company for First Capital Bank, announced a 6.7 percent increase in earnings, to $362,000, for the three months ending June 30.

Growth was fueled by a 32 percent increase in deposits, up $69 million from the same quarter last year, and a 29 percent increase in net interest income, attributable to a 47 percent growth in the loan portfolio partially offset by aggressive interest rate cuts by the Federal Reserve Bank. Nearly 40 percent of the bank's loan portfolio is tied to the prime rate. Expenses increased as the bank added a branch and made "key additions to the lending team."

"While these are clearly some of the most challenging times our industry has dealt with in decades, we're confident it is exactly this environment that will bring our company's strengths to the forefront," said CEO Bob Watts in the quarterly report issued yesterday.

"We've stuck to our knitting, remained conservative in our underwriting and loan structures, grown through attracting experienced lenders and known relationships, and have been selective in the opening and geographic diversity of our new offices." Watts said. "We're well capitalized with uniquely strong asset quality and operate in a market with a proven history of stability. In addition, we have no sub-prime mortgage exposure."

The company operates seven branches in the Richmond region.