Sale of Vision Bank Lifts Park National's Earnings

First-quarter income at Park National (PRK) rose 45%, to $30 million, from a year earlier as the Newark, Ohio, company recorded a gain from the sale of the troubled Vision Bank.

The $6.8 billion-asset company said Tuesday that the sale, which was completed in February, resulted in a pre-tax gain of $22.2 million. Park National bought Vision Bank in 2007 to expand into the Gulf Coast of Florida and Alabama. But the deal quickly soured as Vision was plagued by nonperforming loans.

Park National sold Vision Bank’s 17 branches as well as certain loans and deposits to Centennial Bank, a unit of Home BancShares, for $27.9 million.

"We were pleased to complete the sale of Vision Bank assets during the first quarter of 2012," C. Daniel DeLawder, Park National's chairman, said in a news release. "The continued success of our community banks and specialty finance companies in Ohio will be far more apparent without the negative impact we have endured over the past few years."

The company also recorded a pre-tax gain of $6.6 million from the sale of investment securities. However, Park National's net interest income fell 11%, to $61.7 million, from a year earlier.

The company's credit quality improved as its provision for loan losses fell 36%, to $9 million, year over year while nonperforming loans fells 22%, to $217.7 million.

Park National reported earnings per share of $1.95, beating estimates of analysts polled by Thomson Reuters by 31 cents. The company's shares were trading at $66.92 Tuesday morning, up more than 1% from Monday's close.