Porter Bancorp Inc. in Lousville, Ky., reported a loss of $39 million in the second quarter after it wrote off scores of problem loans and took a hefty impairment charge to reflect its declining market value.
The $1.7 billion-asset company lost $1.1 million in the same quarter last year. On a per-share basis, Porter said it lost $3.33, well above the $1.67 per share analysts at Sandler O'Neill & Partners LP had estimated it would lose.
Porter attributed the large loss in part to its decisions to sell off a single $11 million loan for 47 cents on the dollar and write down the values of other real estate loans based on updated appraisals. The moves helped reduce its ratio of nonperforming assets to 6.65% in the second quarter, down from 8.28% at the same time last year.
"Our loss in the second quarter was largely a result of our strategy to more aggressively move other real estate off our balance sheet," said President and Chief Executive Officer Maria L. Bouvette in a statement.
The company also took a $23.8 million goodwill impairment charge in connection with its declining stock price. Porter's shares have fallen by roughly 53% since the start of 2011, to $4.78 at the close of trading Thursday.