Park National Corp. in Newark, Ohio, swung to a profit in the fourth quarter but still earned less than what analysts were expecting.
The $7 billion-asset company said after markets closed Tuesday that it earned $11.7 million in the fourth quarter compared to a loss of $4.9 million in the same period in 2010.
The turnaround is largely a result of 62% decline in its provision for loan losses, to $16.2 million, and a more than 7,000% increase in its gain on the sale of securities. Results for the 2010 quarter had been recently restated after the company opted to record loan-loss provisions at its troubled Florida bank subsidiary in 2010 rather than 2011.
Park National said that it earned 76 cents per share for the quarter, a significant improvement over the 32 cents it lost in the prior year, but still 16 cents short of estimates of analysts polled by Thomson Reuters.
Credit quality improved markedly year over year, as total nonperforming assets declined 19%, to $273 million. The bulk of the decline was recorded at Vision Bank in Panama City, Fla., which was hammered by the state's real estate bust.
Park is in the process of selling the bulk of Vision's operations to Home Bancshares Inc. of Conway, Ark.
"The pending sale of the Vision Bank operations, which we expect to conclude in the first quarter of 2012, allows us to concentrate fully on our operations in Ohio and our powerful earnings engine as we move forward," Park Chairman C. Daniel DeLawder said in a news release.
Park's Ohio subsidiary, Park National Bank, reported record net income of $106.9 million for the year.