North Valley Bancorp in Redding, Calif., facing an onset of credit problems, reported first-quarter earnings of $280,000, down 87% from a year earlier.
Earning per share fell 86%, to 4 cents. The $945 million-asset company said it doubled its provision for loan losses from the fourth quarter, to $2.4 million. (It did not record a provision in the first quarter of 2007.)
Nonperforming loans soared to $25.8 million, from $460,000 a year earlier and $1.6 million in the fourth quarter. The ratio of nonperforming loans to total loans was 3.43%, versus 0.24% at Dec. 31, 2007.
The company said most of the nonperformers are centered on four real estate projects (two residential developments and two residential acquisitions) in Placer and Shasta counties.
