Regulatory Roster Grows For Consenting Lenders

by George Waldon  on Monday, May. 21, 2012 12:00 am  

The splash of black on the bottom line marked a welcome change from the losses that dominated its income statements the past three years.

While the Bear State investors brought stability to the company's balance sheet, the recapitalization didn't wean First Federal from its 2010 operating agreement with the Office of the Comptroller of the Currency (successor to the Office of Thrift Supervision).

The financial restructuring of the company also helped lessen its year-end loss to $8.5 million.

The red ink for 2011 would've totaled more than $19 million without the $10.5 million discount of First Federal's $16.5 million TARP-share obligations.

Bear State acquired all 16,500 shares of the company's preferred stock previously issued to the United States Department of the Treasury under the TARP Capital Purchase Program and the related warrant for $6 million cash.

The nonaccrual loan total at First Federal declined from $33.9 million at year-end to $26 million as of March 31. Nonaccrual loans represented about 7.4 percent of the company's $348.6 million loan portfolio.

During the first quarter, loans totaling $4.5 million attained nonaccrual status. That was offset by net cash payments of $4.5 million, the return to accrual status of loans of nearly $2 million, charge-offs to loan loss allowances of about $3.2 million and transfers to real estate owned of $2.8 million.



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