First Mariner Bancorp in Baltimore said Monday it had a fourth-quarter a net loss of $33.4 million after reducing the value of some deferred-tax assets.
The $1.3 billion-asset company established a $29.9 million valuation allowance on the assets, resulting in a charge to income tax expense. As a result, losses widened from $3.8 million a year earlier. For the year, losses increased to $46.1 million from $22.3 million.
First Mariner stressed that establishing an allowance does not preclude it from recognizing the assets in the future when it returns to profitability. But the move signals that its auditors have doubts about its ability to generate profits.
Setting aside the tax expense, First Mariner's loss shrank to $3.5 million in the fourth quarter.
"Excluding the negative impact of the valuation allowance on the deferred-tax assets, most other measures of operating performance improved, including higher net interest income, lower net chargeoffs and lower operating expenses compared to the same quarter of 2009," Edwin F. Hale Sr., First Mariner's chief executive, said in a press release.