First Interstate Bank of Utah reported record net income of $2.86 million for the first quarter 1991, up 43 percent from the $2 million reported for the same period last year.

Return on assets increased to 1.32 percent, up from 0.82 percent a year ago. Return on equity improved 20.62 percent for the first quarter, up from 13.10 after the first three months of 1990.Higher net interest income, higher fee income from First Interstate's new insurance subsidiary and lower expenses and provision for loan losses combined to help the bank log the earnings gains, said Richard Keiffer, president.

Problem assets decreased in March to 1.16 percent of total loans, down from 2.14 percent a year ago. Still, Keiffer noted, the bank continues to provide a "strong" loan loss reserve of 2.72 percent.