LYNNWOOD – City Bank has revised its 2008 loss to $60.8 million from the initial $35.8 million loss the bank reported in February.
Independent auditors also issued the Lynnwood-based bank a “going concern” warning, expressing doubt about the bank’s ability to go forward.
The major concern: “the significant maturity of brokered deposits during 2009 and the restrictions by the FDIC on the Bank’s ability to replace these deposits with new brokered deposits as they mature.”
As required, City Bank is developing a plan to address the concerns. The bank said it is aggressively reducing assets through the sale of nonperforming assets to generate cash for the purpose of refunding brokered deposits as they mature.
The revised loss reflects new appraisals of a deteriorating real estate market, bank officials said in a statement Tuesday. The net loss of $60.8 million amounts to $3.86 per share loss for 2008 and $64.9 million, or $4.12 per share, for the fourth quarter.
“This has been a difficult process for us to go through, but we believe the new appraisals reflect the significant decline in the number of monthly home sales in King, Snohomish and Pierce counties since June 2008 levels,” said Conrad Hanson, president and CEO. “As such, there has been a measurable decline in the value of comparable residential real estate sales in our local market the last few months.”
The revised 2008 results are compared to net income of $41.50 million, or $2.62 per diluted share for the prior year end and $10.19 million or $0.65 per diluted share in the prior year quarter.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
