Also: AltaPacific, Westamerica report increased earnings
Charter Oak Bank in Napa reported a loss of $7.3 million for the second quarter of the year as it reserved against loan losses.
Total assets are $140.5 million.
Brian Kelly, the president and chief executive officer said, “We reserved fairly heavily basically reflecting the local economy. The big banks took hits about 18 months ago, and now things are impacting the small businesses.”
He said small businesses that were not too leveraged did well through the worst of the recession but now have all but gone through their reserves.
“The losses we took were mostly surrounding development,” he said. “It is contractors, developers and landowners.”
He said the bank recognizes the issues and knows that while the regulators are going to be concerned at strength and capital and whether the management team is being prudent, he hopes the loss reserves will help in showing that the bank is on top of the areas of concern.
“All regulators want good capital and good growth, and we are hoping to pull through this period of uncertainty,” he said.
The Federal Deposit Insurance Corp. issued its list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act.
The list covers evaluation ratings that the FDIC assigned to institutions in May 2010. The CRA is a 1977 law intended to encourage insured banks and thrifts to meet local credit needs, including those of low- and moderate-income neighborhoods, consistent with safe and sound operations.
Ratings Definitions: O is Outstanding; S is Satisfactory; NI is Needs to Improve; and SN is Substantial Non-compliance.
First Community Bank received a rating of S, Sonoma Valley Bank received an NI, Westamerica Bank received an S and Savings Bank of Mendocino received an S.
Hennessy Advisors announced fully diluted earnings per share of $0.05 for the quarter ending June 30. Net income was $275,000 compared to $23,000 in the same period of 2009. Assets under management grew from $775 million on June 30, 2009 to $813 million on June 30, 2010.
“We are very pleased to report quarterly results to our shareholders where revenue, income, earnings and assets under management have all increased,” said Neil Hennessy, president and chief executive officer of Hennessy Advisors Inc.
“The financial markets have continued to be incredibly volatile,” he said. “And I feel like we are watching a ‘vertical tennis match’ with lobs going up and lobs coming down. Our assets under management have likewise been volatile. However, we continue to manage our business, as we do our mutual funds, with discipline and consistency.”
Sterling Financial Corp., holding company of Sonoma Bank, reported a second quarter net loss of $58.2 million, a $30.5 million reduction in losses over the first quarter of 2010.
The net loss of $1.12 per common share included a provision for credit losses of $70.8 million, which reflects a $17.8 million reduction from the first quarter provision.
“Sterling reported a narrower net loss for the second quarter compared to the first quarter, with a smaller provision for credit losses,” said Greg Seibly, Sterling president and chief executive officer. “We sold off a significant number of non-performing loans as we worked to rebuild and strengthen our balance sheet. At the same time, our core banking business continued to improve as Sterling expanded its retail customer base and increased loan originations compared to the first quarter of 2010.”