Wilmington Trust Corp. reported a 50% plunge in third-quarter net income Friday as it wrote down its investments in Fannie Mae and Freddie Mac.
The financial services company reported net income of $22.9 million, or 34 cents a share, compared with $46.2 million, or 67 cents, a year earlier.
Wilmington recorded a loss of $19.7 million, or 19 cents a share, on its preferred stock holdings in Fannie and Freddie, the troubled mortgage giants taken over by the federal government in September.
Revenue fell 5.3%, to $178.9 million.
Analysts surveyed by Thomson Reuters had expected earnings, excluding items, of 42 cents a share on revenue of $187 million.
The net interest margin fell to 3.27%, from 3.73%.
The loan-loss provision more than doubled, to $19.6 million from $8.9 million a year earlier. Nonperforming loans, those in danger of default, rose 56% from a year earlier and 30% from the second quarter. The net chargeoff rate, loans the bank thinks are uncollectible, was 0.11%, compared with 0.06% a year earlier and 0.19% in the second quarter.
