Herbert L. Hornsby Jr., the president and chief executive of Cape Bancorp Inc. in Cape May Courthouse, N.J., abruptly resigned Tuesday, a day after the company announced a large increase in its provision for loan losses and said it was delaying the release of its earnings as it considered goodwill impairment charges related to a 2008 acquisition.
Michael D. Devlin was named Mr. Hornsby's successor. Mr. Devlin has been the company's chief operating officer since Cape bought Boardwalk Bancorp Inc. of Linwood, N.J., in January 2008.
The $1.1 billion-asset Cape was to have released earnings Tuesday but said it was delaying them because it anticipates a "material" goodwill impairment charge for the Boardwalk acquisition "due to the decline in economic conditions throughout the past year." In its press release, the company said it took a $54.2 million impairment charge in February 2008.
The company also said that it took a $6.8 million provision for loan losses in the fourth quarter, a 5,428% increase from the year earlier, according to Federal Deposit Insurance Corp. data. The fourth-quarter provision would be five times greater than the company's third-quarter provision. Nonperforming loans at yearend were $25.6 million, a 525% increase from the end of 2007.