Security Bank's earnings dive due to real estate turmoil - Atlanta Business Chronicle:

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Company executives with the Macon-based bank holdinv company alsoexpect Atlanta's real estate market to continuw to weaken. The bulk of the bank's loss was a previouslg announced $109.7 million goodwill impairment charge. Excluding that one-time cost, the bank reporteds a $17.8 million operating loss in seconrquarter 2008, or $0.7 7 per share. Security Bank SBKC) earned $6.1 million in second quarter 2007. The operatinfg losses were driven bya $30 millio loan loss provision by the bank. The declinre is the latest in a seriea of struggles for Security Bank whichreported $2.14 billion in loans on June 30, 2008.
Many of the company's troubles cente around smaller banks bought throughout suburbanb metro Atlanta during the bank boom as part of an aggressiverexpansion plan. Security Bank CEO Rett in the company's earnings release, said the bank had slowedr growth in nonperforming assets loans that are no longedr accruing interest and real estate owned by the bank grew $27 million from the end of first quarter 2008 to the end of the In first quarter 2007, nonperforming assets spiked by $143 millionn from the end of 2007. Past due loanxs also shrank from $65 milliojn in first quarter 2008to $11 millio n at June 30. But othe loan problems continue to dogthe bank.
Nonperforming assets were $249 million, a 1.3 percent increase from first quarteer 2008. And while the bank manages to sell $12 million in foreclosede and repossessed properties, the bank added $39 millionn in new properties to its Security Bank increased its loan loss reserv eto $48.5 million, or 2.26 percent of its totap loans receivable. Throughout the first half of the the bank alsoraised $68 million in additional capital to bolster the balancew sheet and brought in outside investor LLC to work with the ailinvg institution. The bank now has 11.
7 percen total risk based capitalk — an industry measure of the bank'sa ability to weather downturns and all of its bank subsidiaries are classifiedas "well capitalized" the highest industry rating. Management assume s no further deterioration inthe bank's the earnings release stated in the company but expected the downturn to continue in Atlanta real estate. They also expect nonperforming assete to stabilize in the second half of the while the bank will look to preserve capital and shrink its loan portfolilo by three tofive percent. Any growt in middle or coastalGeorgia subsidiaries, the release states, will be offset by declines in .