Metropolitan lowers 2008 earnings by $7.8 million.
"The restated net income is $1.39 million compared to the previous net income figure of $9.2 million for the fiscal year 2008," the bank said in a written statement. The statement said the problem loans were "particularly in the northwest Arkansas region."
Instead of $2.03 million in income for the fourth quarter, Metropolitan will report a loss of about $5.7 million, said CEO Lunsford Bridges--the first quarterly loss in the bank's 39-year-history and its first restatement of earnings.
The restatement was prompted by a routine examination by the Office of the Comptroller of the Currency.
Bridges said the OCC had not yet completed its review of the bank's books, but the remainder of the examination would not affect the bottom line.
Metropolitan's statement said its allowance for loan and lease losses had been increased to $31.5 million--2.79 percent of total loans--as of Dec. 31. That compares with an average allowance in the fourth quarter of 1.56 percent of total loans among similar banks, according to the Uniform Bank Performance Report issued by the Federal Financial Institutions Examination Council. Metropolitan's original year-end call report showed an allowance of $19.26 million.
Of that additional $12.24 million, Bridges said, $3.3 million was written off based on the current appraised value of real estate used as collateral. He wouldn't say whether the write-down was on a single loan or multiple loans.
Earlier this month, Metropolitan announced management changes affecting its presence in northwest Arkansas.
Bridges said the northwest Arkansas market seemed to be stabilizing. "I think it is. There's some strengthening in some areas of the real estate market up there--stable in a few but very little activity in some areas."
The "general feeling," he said, is that "the worst is over in northwest Arkansas. The real question is the comeback--when and how quickly."
Metropolitan has confirmed plans to close three branches in central Arkansas Kroger stores in the first half of 2009. Bridges said the bank had no plans to close any other branches. "hings are changing," he said.
"This economy is changing.
I don't anticipate [closing more branches] but never say never."
Metropolitan National Bank had $1.68 billion in total assets as of Dec. 31, down from $1.87 billion at the end of 2007 and a reflection of the improvement in its balance sheet after an agreement last year with the OCC.
|Printer friendly Cite/link Email Feedback|
|Title Annotation:||BANKING & FINANCE|
|Date:||Mar 23, 2009|
|Previous Article:||Kyzer note.|
|Next Article:||Bank denies allegations in Terminella motion.|