The bottom line at Solera National Bancorp in Lakewood, Colo., improved from a year earlier, though losses persisted amid management upheaval.

The $148 million-asset bank reported a loss of $442,000 in the third quarter, compared with a $638,000 loss in the same quarter of 2013. It latest loss per share was 17 cents.

In March activist investor Michael Quagliano launched a proxy battle for board control, in a push to restructure the bank.

Quagliano gained control in May, winning the backing of Solera's shareholders. Since then, he has ousted the bank's chief executive, John Carmichael. He also appointed Robert Fenton as CEO.

Fenton, who is the bank's fifth CEO in six years, previously served as the bank's chief financial officer, before being terminated in March. Following his departure, he threw his support behind Quagliano to oust the Solera board.

Solera curtailed its losses in the latest quarter thanks primarily to a 46% drop in operating expenses, to $1.9 million. The bank attributed the decrease to lower compensation costs, offset by higher expenses associated with the closure of its mortgage division.

Income from interest-earning assets fell by 5%, to $1.1 million. The net interest margin increased 16 basis points, to 3.08%

Fee-based income plunged 66%, to $571,000. The bank attributed the decrease to the wind-down of its mortgage division during the third quarter.

"Given the significant change in Solera's business model from a year ago … we believe the company's ability to maintain a steady interest income stream and continue to manage interest expense was a positive takeaway," Fenton said in a press release Friday.

 

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