Dec 28 (Reuters) - Community Shores Bank Corp (CSHB.O: Quote, Profile, Research) said it expects its fourth-quarter earnings to be hurt by an increase in loan-loss provision.
Shares of the company were trading up 8 percent at $6.89 in afternoon trade on the Nasdaq. The shares earlier touched a new year-low of $6.33.
The loan-loss provision will reduce pre-tax earnings by about 68 cents a share for the quarter, the company said in a statement.
"Conditions in our market necessitate this increased provision. The prolonged slowdown in residential real-estate sales has raised concerns about borrower liquidity and the future ability of these borrowers to service debt," Chief Executive Heather Brolick said.
The company said it expects its fourth-quarter provision for loan losses to be about $1 million.
Of this, an allocation of $689,000 would be made related to the impairment of a commercial loan. Additionally, an increased allocation of $100,000 has been made on its $15 million portfolio of residential and land-development loans.
The community banking firm said it was increasing its reserve allocation for loans to residential real-estate and land developers due to deteriorating conditions in the bank's local market. (Reporting by Bijoy Koyitty; Editing by Vinu Pilakkott)
http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSBNG17233520071228
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