Horizon Financial Corp. in Bellingham, Wash., said Thursday that it swung to a loss in the first quarter and that Dennis Jones, the president and chief operating of its bank, had resigned.

The $1.47 billion-asset company lost $25.7 million. A year earlier it had made $3.8 million. The loss was largely attributable to a $40 million loan-loss provision — 20 times what was set aside a year earlier. Nonperforming assets jumped 625 basis points from a year earlier and 144 basis points from yearend, to 7.13% of total assets on March 31.

The Horizon Bank subsidiary remained adequately capitalized, with a leverage ratio of 6.34%, a Tier 1 risk-based capital ratio of 7.29% and a total risk-based capital ratio of 8.58%. Under a Feb. 26 cease-and-desist order from regulators, the bank must increase the leverage ratio to 10% by late November.

Horizon Financial said it is searching for a successor to Jones, who also resigned from the boards of the holding company and the bank.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.