Alaska Pacific Bank racked up another loss in the first quarter of 2010, following unusual yearly losses in 2008 and 2009.
The Juneau-based bank, a subsidiary of the publicly traded Alaska Pacific Bancshares, has faced increased regulatory scrutiny after a series of bad real estate investments. It was the only bank in Alaska needing the assistance of TARP bailout funds from the federal government.
The total loss for the quarter was $470,000, or 72 cents per share, after the preferred stock dividends for the Troubled Asset Relief Program investment in the bank. Dividends for common shareholders have long been suspended.
The bank also recently announced a new chairman, Bill Corbus, elected at its annual meeting in May. Corbus replaces retiring chairman and director Roger Grummett.
In the bank's report for the quarter ending March 31 and filed with the Securities and Exchange Commission, it reported a loss of $395,000.
In the same quarter of 2009 Alaska Pacific had earned a profit of $209,000.
Bank Chief Executive Officer Craig Dahl called it "a frustrating two and a half years," but continued to say the core business of the bank remains strong.
The company's biggest source of income is the money it makes from interest on loans, an amount which declined $58,000 due to fewer loans and lower interest rate profits.
The bank also reported expenses of $721,000 to cover loan losses, up from the $60,000 last year.
The bank also made $135,000 less than the $230,000 it made last year in mortgage banking income. That's the money the bank makes from originating mortgages and selling them to other companies, but it's a business which has been hurt by housing market declines.
The bank during the quarter also acknowledged a higher amount of impaired loans, or those that may not be fully repaid. That amount is now estimated at $11.6 million, up from $5.3 million last year.
The largest of the newly impaired loans was a $2.1 million commercial real estate loan in Idaho, the bank said.
Bank President Craig Dahl has said that the bank's financial difficulty resulted from several "loan participations" in which Alaska Pacific joined with other smaller banks to fund real estate developments outside Alaska.
The bulk of the newly impaired loans were in commercial real estate.
In 2009 the bank's primary regulator, the Office of Thrift Supervision, signed an agreement with Alaska Pacific Bank requiring it to meet tough new conditions aimed at keeping it solvent.
The bank said in the March 31 filing that it believes it is in compliance with the agreement, but that if it fails to meet those conditions additional regulatory action could be taken against it.
Newly elected to Alaska Pacific's board of directors were Linda Thomas of Alaska Pacific Brewing and Doug Andrew, a Ketchikan businessman and owner of the Prospector Hotel in Juneau.
Contact reporter Pat Forgey at 523-2250 or email@example.com.
Juneau Empire ©2015. All Rights Reserved.