Columbia Bancorp in The Dalles, Ore., said it would charge off $2.1 million this quarter because of a bad loan to a potato farmer.
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The $1 billion-asset Columbia said late Monday that it would increase its loan-loss provision by $1.7 million to cover the chargeoff.
It said that it originally thought the farmer had enough collateral to cover the loan's $2.38 million balance, but that potato processors subsequently rejected the farmer's stored crop, because it was badly deteriorated. As a result, Columbia will have to liquidate the farm equipment collateral, to cover the remaining $278,000.
The company did not say how the chargeoff would affect second-quarter earnings. Last year it earned $3.2 million in the second quarter.
