MB Financial Inc. in Chicago on Friday posted a third-quarter loss of $5.4 million compared with earnings of $4.9 million a year earlier and blamed continued high credit costs.
The $10.6 billion-asset company's provision for loan losses was $65 million, down 23% from the second quarter but 44% higher than a year earlier.
MB Financial has been working aggressively to wind down a portfolio of construction and development loans.
As of Sept. 30, its nonperforming loans totaled $452 million, or 4.26% of total loans. This was up 16% from the second quarter and 46% from a year earlier.
Despite its credit problems, MB has ample capital. Its bank unit had a total risk-based capital ratio of 17.14%.
The company has been a frequent buyer of failed banks in recent years.
The bargain-purchase gains associated with such transactions have boosted earnings in other quarters.
For instance, in the second quarter, MB reported earnings of $16.6 million, largely driven by a $62.6 million bargain-purchase gain associated with its acquisitions of Broadway Bank and New Century Bank.