Profits drop for Frontier, EverTrust

  • Bryan Corliss / Herald Writer
  • Tuesday, January 22, 2002 9:00pm
  • Business

By Bryan Corliss

Herald Writer

Two Snohomish County banks reported Tuesday that their profits had slipped.

Frontier Financial Corp.’s year-end profit of $24.5 million was down from 2000’s profit of $32.1 million, largely because the bank company shifted funds to its loan loss account after discovering that a heavy equipment rental business had made fraudulent statements on a loan application, bank officials said.

EverTrust Financial Group reported earnings of $1.3 million for the quarter that ended Dec. 31, which is the third quarter of the bank company’s fiscal year. That compares with earnings of $1.4 million for the same quarter of the previous year.

Per-share earnings, however, climbed for EverTrust, due to a stock buy-back program. Earnings per share went from 19 cents in the same quarter last year to 25 cents in the most recent quarter.

Frontier officials said 2001 marks the first year in the bank’s 24-year history that profits have not grown over previous years.

The bank company ended up writing off a $9.3 million loss due to the one bad loan, which Frontier reported in November.

The loan was made to a heavy equipment rental business, which the bank has not yet identified. The business put up its heavy equipment as collateral, but when bankers looked into irregularities with the account, they found that some of the equipment had been sold and some had been pledged fraudulently as collateral to other lenders as well.

Frontier foreclosed on the loan, seized what equipment it could and sold it at auction. But it still took a big hit on the books. The loss amounted for 95 percent of the $9.8 million total.

The bank ended up putting $13 million into its loan loss fund during the quarter. That was "primarily to cover the specific loss," according to Frontier chief executive Bob Dickson. But the bank also "felt it was prudent to build up the reserve in view of the uncertainty caused by a slowing economy."

EverTrust also is keeping an eye on the economy, chief financial officer Jeffrey Mitchell said.

The banking group wrote off $157,000 in bad loans during the quarter, up from $55,000 a year ago. The total was incorrectly reported. That’s actually closer to historical averages, Mitchell said. "The past several years was unusually low."

But "general economic conditions and indicators in the Puget Sound region, particularly Snohomish County, have deteriorated over the last quarter, and we expect further weakening in the quarters ahead," he added.

Frontier finished 2001 with $1.8 billion in assets, up 6.9 percent. Net loans increased 14 percent, to over $1.5 billion. Net interest income was up 4.2 percent to $83.6 million, and non-interest income increased almost 17 percent, to $8.3 million — a fact Frontier attributes to increased mortgage banking operations and service charges.

EverTrust finished the quarter with $647 million in assets, up from $602 million on March 31, the end of the company’s last fiscal year. Net loans receivable grew from $483.1 million to $556.6 million during the same period, and the bank originated $75.7 million in new loans during the quarter.

Net interest income went from $5.8 million to $6.6 million, comparing the most recent quarter with the same one from the year before.

EverTrust will resume its stock buy-back program on Thursday.

You can call Herald Writer Bryan Corliss at 425-339-3454

or send e-mail to corliss@heraldnet.com.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Business

A closing sign hangs above the entrance of the Big Lots at Evergreen and Madison on Monday, July 22, 2024, in Everett, Washington. (Ryan Berry / The Herald)
Big Lots announces it will shutter Everett and Lynnwood stores

The Marysville store will remain open for now. The retailer reported declining sales in the first quarter of the year.

George Montemor poses for a photo in front of his office in Lynnwood, Washington on Tuesday, July 30, 2024.  (Annie Barker / The Herald)
Despite high mortgage rates, Snohomish County home market still competitive

Snohomish County homes priced from $550K to $850K are pulling in multiple offers and selling quickly.

Henry M. Jackson High School’s robotic team, Jack in the Bot, shake hands at the 2024 Indiana Robotics Invitational.(Henry M. Jackson High School)
Mill Creek robotics team — Jack in the Bot — wins big

Henry M. Jackson High School students took first place at the Indiana Robotic Invitational for the second year in a row.

The computer science and robotics and artificial intelligence department faculty includes (left to right) faculty department head Allison Obourn; Dean Carey Schroyer; Ishaani Priyadarshini; ROBAI department head Sirine Maalej and Charlene Lugli. PHOTO: Arutyun Sargsyan / Edmonds College.
Edmonds College to offer 2 new four-year degree programs

The college is accepting applications for bachelor programs in computer science as well as robotics and artificial intelligence.

FILE — Boeing 737 MAX8 airplanes on the assembly line at the Boeing plant in Renton, Wash., on March 27, 2019. Boeing said on Wednesday, Feb. 21, 2024, that it was shaking up the leadership in its commercial airplanes unit after a harrowing incident last month during which a piece fell off a 737 Max 9 jet in flight. (Ruth Fremson/The New York Times)
Federal judge rejects Boeing’s guilty plea related to 737 Max crashes

The plea agreement included a fine of up to $487 million and three years of probation.

Neetha Hsu practices a command with Marley, left, and Andie Holsten practices with Oshie, right, during a puppy training class at The Everett Zoom Room in Everett, Washington on Wednesday, July 3, 2024. (Annie Barker / The Herald)
Tricks of the trade: New Everett dog training gym is a people-pleaser

Everett Zoom Room offers training for puppies, dogs and their owners: “We don’t train dogs, we train the people who love them.”

Andy Bronson/ The Herald 

Everett mayor Ray Stephenson looks over the city on Tuesday, Jan. 5, 2015 in Everett, Wa. Stephanson sees  Utah’s “housing first” model – dealing with homelessness first before tackling related issues – is one Everett and Snohomish County should adopt.

Local:issuesStephanson

Shot on: 1/5/16
Economic Alliance taps former Everett mayor as CEO

Ray Stephanson will serve as the interim leader of the Snohomish County group.

Molbak's Garden + Home in Woodinville, Washington will close on Jan. 28. (Photo courtesy of Molbak's)
After tumultuous year, Molbak’s is being demolished in Woodinville

The beloved garden store closed in January. And a fundraising initiative to revitalize the space fell short.

Everett Mayor Cassie Franklin, Advanced Manufacturing Skills Center executive director Larry Cluphf, Boeing Director of manufacturing and safety Cameron Myers, Edmonds College President Amit Singh, U.S. Rep. Rick Larsen, and Snohomish County Executive Dave Somers participate in a ribbon-cutting ceremony on Tuesday, July 2 celebrating the opening of a new fuselage training lab at Paine Field. Credit: Arutyun Sargsyan / Edmonds College
‘Magic happens’: Paine Field aerospace center dedicates new hands-on lab

Last month, Edmonds College officials cut the ribbon on a new training lab — a section of a 12-ton Boeing 767 tanker.

Gov. Jay Inslee presents CEO Fredrik Hellstrom with the Swedish flag during a grand opening ceremony for Sweden-based Echandia on Tuesday, July 30, 2024, in Marysville, Washington. (Ryan Berry / The Herald)
Swedish battery maker opens first U.S. facility in Marysville

Echandia’s marine battery systems power everything from tug boats to passenger and car ferries.

Helion Energy CEO and co-founder David Kirtley talks to Governor Jay Inslee about Trenta, Helion’s 6th fusion prototype, during a tour of their facility on Tuesday, July 9, 2024 in Everett, Washington. (Olivia Vanni / The Herald)
State grants Everett-based Helion a fusion energy license

The permit allows Helion to use radioactive materials to operate the company’s fusion generator.

People walk past the new J.sweets storefront in Alderwood Mall on Thursday, July 25, 2024, in Lynnwood, Washington. (Olivia Vanni / The Herald)
New Japanese-style sweets shop to open in Lynnwood

J. Sweets, offering traditional Japanese and western style treats opens, could open by early August at the Alderwood mall.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.