Temecula Valley Bancorp Inc. in Temecula, Calif., said Thursday that it lost $3.6 million in the third quarter after setting aside $7.6 million to cover problem real estate and construction loans.
The $1.5 billion-asset company had earned $2.6 million the year earlier.
Though the company reported strong loan growth, particularly in its Small Business Administration portfolio, net nonperforming assets as a share of total assets climbed to 5.6% at Sept. 30, from 1.39% a year earlier.
Chairman, president, and chief executive officer Stephen H. Wacknitz noted in a press release "the good news" that 92% of its loans are secured by real estate underwritten at an average loan-to-value ratio of 64%. He added that, though the company is considered well-capitalized, it is considering participating in the Treasury Department's Capital Purchase Program.