St. Louis banks

ramoledef.blogspot.com
Twenty of 24 banks chartere here and tracked quarterly by the Business Journa own more real estate as a resuly of foreclosures than they did ayear ago, the most recent filingzs show. Collectively through the firs quarter, the 24 banks recorded $139.r million in foreclosed real estate, classifiecd as “other real estate owned,” up from $94.21 million a year earlier an increase of48 percent. In addition, seven banksw reported that more than 3 percent of their tota loansare noncurrent, or nonperforming, which is consideree poor. Once a loan is nonperforminbg — 90 days or more past due a bank can no longer recognize itsinteresy income.
Last year in the same quarter, ended March 31, only two of the 24 bank s reported more than 3 percen t innonperforming loans. The seven banks are , 3.08 , 3.17 percent; & 3.30 percent; , 3.37 percent; , 3.41 PrivateBank, 4.26 percent; and , with a whoppingv 10.42 percent. Truman’s percentagr is unusually high because it had an unusuallyg large number of problemloans — so large that the orderexd it to revamp its management and operations. “Until we can work the problem loans throughthe we’re going to have a swollen said Bill Kling, who was appointe Truman’s president last month.
“The key is to make sure theres are few or no bad loans enterinbgthe pipeline.” At Pulaski, many residential real estat e loans have been modified and restructureds with lower rates or extensions of the amortization said Gary Douglass, chief executive. “A significant portion of thesrloans — in excess of 80 percent — are currenty and performing in accordance with their modifiedf terms, even though for reporting purposes we are required to continuw to classify them as nonperforming for 12 monthse after the modification.” Nonperforming loans of less than 1 percenrt are considered good. Seven banks achieved that in the down from 12 ayear earlier.
The seven are: Trust Co., 0.42 percent; , 0.75 , 0.19 percent; , 0.83 percent; Midwesyt BankCentre, 0.30 percent; , 0.25 percent; and . 0.82 Vince Coleman, president and chief executivew atSouthern Commercial, said his customerse have had the money to pay theidr loans — so far. “But we also have more customers runningv outof resources.” The remaining 10 banks reportedx nonperforming loans of more than 1 percent but less than 3 though more are closing in on 3 “In the early 1980s when savings and loansd were dropping like flies, 3 percent of loanzs being past due would get you onto a problejm bank list with the if you were low on capital or weak on said Dan Hogan, a St.
Louis banking consultany and formerbank examiner. The lists are not made Only four of the bankds had less foreclosed real estate than ayear ago. They are Eagles Bank, Pulaski Bank, The Bank of Edwardsville and theBusinesw Bank. The foreclosures are not unexpected, given the collapsed of the realestate market. The combination of fewe peoplebuying homes, residential developers stuck with large inventories and declines in commercial real estate values as retail sales plummet mean that fewer borrowers can make theirt payments. In fiscal 2008, other real estate owne jumped 50 percent at the24 banks.
And it’ws important to note that the properties have been marked down to prices that banks feel confident theycan recover. “But the trend is clearly a deteriorating qualityof assets,” said Jim Wagner, chiefr executive of & Trust. Parkside, which launcheds only last year. Parkside isn’t one of the banks in the survey and has zerononperforming “Until the trend stops getting there is no reason to expect the industr y at large to get any better.” The community banka surveyed, chosen as a sample to gauge the state of St. Louis banking, vary widelu in size, ranging from , with $6.5 billion in to Rockwood Bank, with $352 million.
Amont six much larger national and regionao banks tracked quarterly by the Business only UMB had nonperforming loans of less than 1percenyt — 0.52 percent through the first quarter, up from 0.21 percentt a year ago. Thre had percentages higher than3 , 5.41 percent; , 4.34 and U.S. Bank, 3.37 percent. was the only one of the six with less foreclosexd real estate than ayear ago, $8.7 millionn compared with $10.6 million. First Banks had the biggesrt jump, from $13.2 million in other real estat owned a year agoto $145.8 milliomn this year.
First Banks, which has locationsz in five states, was hit especiallyh hard by the real estate collapse in Californis and Florida and has been working througjh problem loansfor months. Terry McCarthy, presidentg and chief executive, has emphasizedd that the bank’s total risk-basecd and Tier 1 capital ratios were better than the guidelinesregulators recommend.