Provident Bankshares Corp. warned Wednesday that it expects to write down as much as $47.7 million this quarter because of a significant drop in the value of its investment securities.
This would be the $6.2 billion-asset Baltimore company's second consecutive quarter with a big writedown.
But Larry Beyer, Provident's treasurer, said in an interview Wednesday that the company would remain well capitalized.
Provident said in its fourth-quarter earnings report Jan. 16 that it wrote down its investment securities by $47.5 million.
It lost $15.5 million in the quarter overall, compared with net income of $11.3 million the year earlier.
On Wednesday, the company said continued deterioration in the residential mortgage and home building industries would force it to take an additional charge, potentially totaling $47.7 million.
It could write down as much as $32.8 million on trust-preferred securities tied to real estate investment trusts and home building and as much as $14.9 million on mortgage-backed securities.
"Obviously the difficult environment continues, and obviously we're disappointed and frustrated by this announcement," Gary N. Geisel, Provident's chairman and chief executive officer, said during a conference call with analysts.
Provident's stock fell 2.2% by late Wednesday afternoon, to $15.93. It was down 16.8% since the January announcement.
