Wilmington Trust Corp. of Delaware announced that it swung to a quarterly loss, as its loan-loss provision swelled and securities losses reached $98.4 million during the fourth quarter.
The financial services company sold $330 million in preferred stock and warrants to the Treasury Department as part of its participation in the agency's Capital Purchase Program.
Wilmington Trust, which focuses on commercial lending, posted a net loss of $68.5 million, or $1.02 a share. It reported net income of $44 million, or 65 cents a share, in the fourth quarter of 2007.
Excluding securities losses and writedowns, the loss would have been 10 cents a share. The average estimate of analysts polled by Thomson Reuters called for per-share earnings of 12 cents.
Wilmington Trust's loan-loss provision rose to $67.5 million, in line with its forecast this month. The third quarter's provision was $19.6 million and the year-earlier one was $9.2 million.
Standard & Poor's cut its credit rating on Wilmington Trust and its main bank unit this month after the company announced the provision forecast.
Nonaccruing loans doubled during the quarter, primarily because of several construction loans related to residential housing developers in the Middle Atlantic, Wilmington Trust said Friday.
Acquisitions helped revenue for Wilmington Trust's corporate client services operations rise 52% to a record high. The segment provides back-office service for unbundled retirement plans.
Wealth advisory revenue fell 9% because of lower asset values. Wilmington Trust also announced Friday that it has terminated its automated teller machine equity offering sales agreement with Merrill Lynch Pierce Fenner & Smith Inc. because of ongoing costs associated with maintaining the program over an extended period of time.