Berkshire Hills discloses issue with commercial loan
Berkshire Hills Bancorp in Boston disclosed that its quarterly earnings could take a hit due to exposure to a commercial loan.
The $13.7 billion-asset company disclosed in a regulatory filing Friday that it has a $16 million participating interest in a loan secured by business assets.
The lead lender advised Berkshire of a recent default on the loan due to potentially fraudulent activity. While it is evaluating the situation, Berkshire said it expects its third-quarter net income “will be adversely affected.”
Berkshire said it does not have any other accounts or business arrangements with the borrower.
Several analysts have indicated that the issues could be tied to a $36 million participation to MyPayrollHR, which is being investigated by the FBI for fraud.