Shares of Wilshire Bancorp Inc. plunged Tuesday after the Los Angeles company announced that it lost $52.1 million, or $1.77 per share, in the quarter that ended March 31. Wilshire earned $2.4 million, or 8 cents per share, in the same quarter a year earlier.
The $2.8 million-asset Wilshire attributed the loss to two key factors: a $38.1 million tax expense that resulted from a deferred tax asset valuation in the quarter, and an increase in its loan-loss provision as a result of transferring $93.4 million of problem loans to held-for-sale status. The transfer increased chargeoffs for the quarter to $41.7 million, compared to chargeoffs of $5.8 million in the first quarter of 2010.
Wilshire's shares were down 18% midday Tuesday, to $4.13.
Jae Whan Yoo, who took over as Wilshire's president and chief executive officer in February, said that the company would continue to take aggressive steps to shed problem assets so that "we can return to being the high-performing bank that our customers and shareholders deserve."
Woo, a former CEO of two Korean-American banks in Los Angeles, wasted little time addressing the company's credit-quality problems, announcing in March that Wilshire was restating its fourth-quarter earnings to reflect an $18 million addition to its loan-loss provision. Over the last two months he has also separated the bank's loan and underwriting functions, appointed a chief risk officer, created a credit task force and instituted a new in-house lending limit to single borrowers.