Capital Bank Corp. of Raleigh, which has announced plans to raise 34.5 million shares in a public offering, said it expects some improvement in its credit quality in the third quarter.

The $1.7 billion-asset company said it projected its provision for loan losses and chargeoffs would be reduced by more than half compared with the second quarter, according to a Securities and Exchange Commission filing released Monday.

Nonperforming assets and capital are estimated to be in line with its second-quarter performance.

The company, whose bank unit is Capital Bank, did not say when it will release its third-quarter earnings.

The company said it expected the provision for loan losses to be between $6.2 million and $6.8 million, compared with $20 million posted in the second quarter.

Nonperforming assets and restructured loans are projected to "remain at or near the same level" on Sept. 30 as they were at the end of the second quarter.

They totaled $97.5 million, or 5.76% of total assets, as of June 30.

Coupled with a slight reduction in total loans in the third quarter, the company's total risk-based capital is estimated to be between 10.5% and 10.6%, in line with the 10.6% total risk-based capital figure it posted in the second quarter.

Capital Bank Corp. plans to raise about $62 million in capital by selling up to 34.5 million shares of common stock some time this year.

In a stock presentation filing that the SEC released Tuesday, Capital Bank Corp. said one reason it was raising capital was to "seize opportunities from the 'big boys' that dominate the markets but are distracted by both the economic downturn and a changing regulatory environment."

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