PORTLAND (AP) – Banknorth Group Inc. on Monday reported record quarterly earnings of $87.5 million, a 15 percent increase over a year ago.

The bank holding company said its net income was 53 cents per share, up from 51 cents a share for the second quarter of 2002. Its operating income was 54 cents a share, which was in line with expectations of analysts polled by Thomson First Call.

“I am pleased that strong net interest income and fee income supported by sound expense management have resulted in a record quarter,” William Ryan, Banknorth president and chief executive officer, said in a statement.

Jim Ackor, an analyst with RBC Capital Markets in Portland, said Banknorth has continued to succeed by using a conservative approach in a difficult economic environment.

“Another solid quarter from Banknorth, I don’t think there’s any other way to describe it,” he said.

For the six months of the year, Banknorth had net income of $168.9 million, up 17 percent over 2002. It earned $1.04 per share for the first half of the year, an 8 percent increase over last year.

For the quarter, Banknorth reported that its loan and lease portfolio was 21 percent higher at the end of June than it was a year earlier, which helped offset shrinking profit margins.

Its net margin was 3.71 percent for the quarter, down from 4.18 percent for the second quarter in 2002 but up slightly from the first quarter of the year.

It reported that deposits increased 23 percent to $17.7 billion and that its total assets of $25.8 billion were up 21 percent from last year.

Banknorth Group’s banking subsidiaries include Peoples Heritage in Maine, Bank of New Hampshire, Banknorth Massachusetts, Banknorth Vermont, Banknorth Connecticut and Evergreen Bank in upstate New York.