Shares of Cascade Bancorp fell sharply Friday after the Bend, Ore., company announced it had revised fourth-quarter and 2007 earnings to reflect growing weakness in its portfolio of construction and land development loans.
The $2.4 billion-asset Cascade initially reported a loan-loss provision of $7.5 million but increased it to $15.6 million after it found evidence that the underlying value of collateral was lower than it had estimated. As a result, it said its fourth-quarter net income was $300,000 instead of the $5.3 million it reported Jan. 23.
Net income for the year was $30 million, $5 million less than previously reported.
Cascade's shares closed $11.17, down 7.8% from Thursday's closing price.
Patricia L. Moss, Cascade's chief executive, said in a press release, "As we navigate through this challenging downturn in the real estate market, we will continue to monitor our loan portfolio and take appropriate measures to reserve against the risks posed."
