MBT Financial Corp. of Monroe, Mich., has revised its fourth-quarter results and posted a much bigger loss than previously announced, citing a problem with a loan to an automotive supplier.
The $1.5 billion-asset company said after the market closed Thursday that it lost $2.7 million, or 17 cents a share. Last month it had reported a fourth-quarter loss of $161,000, or a penny a share.
MBT's stock fell 2.3% to $8.63 by midafternoon Friday.
The company said it expects a loss of $5 million on the loan. It previously had estimated its loss from the loan at $1 million.
MBT added $4 million to its fourth-quarter provision for loan losses to reflect the change. The provision jumped more than sixfold from a year earlier, to $8.9 million.
H. Douglas Chaffin, the company's president and chief executive officer, said in a press release that "new information" about the troubled loan made it apparent a higher provision was needed.
Mr. Chaffin cited accounting irregularities discovered in the borrower's financial statements, a bankruptcy filing by a significant customer of that business, increased concern about the viability of the business, and a revised valuation of the collateral.
MBT said its results were also hurt by economic weakness and declining real estate values in southeastern Michigan.
David Scharf, an analyst with First Horizon National Corp.'s FTN Midwest Securities Corp., said in an interview that he thinks MBT is "doing a good job" of aggresively working through its loan troubles.
"Most banks in southeast Michigan are in similar, if not worse, condition," he said.
