Baylake Corp. of Sturgeon Bay, Wis., said Monday that it lost $2.3 million in the first quarter after it was forced to boost its loan-loss provision to nearly $6 million.
The $1.1 billion-asset company had earned $1.3 million in the same period a year earlier.
Baylake attributed the provision which rose from $200,000 a year earlier to impaired commercial loans. It said $3.6 million of the provision covers a single loan where the collateral value had deteriorated. In all, it said that nonperforming loans jumped 39% from the previous quarter, to $39.1 million
T.L. Herlache, Baylake's chairman and chief executive officer Baylake, wrote in a letter to shareholders that it is in "the later stages" of cleaning up its loan portfolio and should start to show significant improvement. The letter said that Baylake has implemented a consultant's recommendations to centralize its loan processing and create a chief credit officer position.
