United Bankshares Inc. in Charleston, W.Va., said Thursday that fourth-quarter earnings declined 36% from a year earlier, to $16 million, mainly as a result of costs associated with a balance-sheet restructuring.
Earnings per share fell 38%, to 37 cents.
The $7.7 billion-asset United prepaid $380 million of long-term Federal Home Loan bank advances and terminated an interest rate swap associated with one of the advances. Prepaying the advances resulted in pretax penalties of about $4.3 million, and terminating the swap resulted in a pretax loss of about $8.9 million.
Like most other banking companies, United reported that its asset quality slipped as a result of the weakening real estate market. Nonaccrual loans increased more than 145% last year, to $14.1 million at yearend, in large part because of $7.3 million of nonperforming loans United inherited when it acquired Premier Community Bankshares Inc. of Winchester, Va., in the third quarter.
For the fourth quarter, United took a loan-loss provision of $2.6 million, or nearly 10 times the size of its provision a year earlier.
