Las Vegas bank owner Western Liberty Bancorp, as expected, today posted a hefty loss for the second quarter because of loan defaults.
The owner of Service1st Bank of Nevada said it lost $4.6 million, or 30 cents per share.
Most of that was attributed to a $4.4 million provision for loan losses.
Western Liberty was a shell company in last year’s second quarter, so there is not a comparable earnings figure from 2010.
The 2011 second quarter loss compares to a loss of $409,000, or 3 cents per share, in this year’s first quarter.
The company disclosed last month that it faced substantial losses tied to the struggling Las Vegas economy.
In today’s earnings report, the bank owner said it continues to look at strategic alternatives such as a sale or a merger – and in the meantime will buy back up to 5 percent of its outstanding shares.
"We have the capital resources to ride out the downturn, and fortunately have the ability to wait for the right opportunities. In the meantime, we continue to focus on maintaining a strong balance sheet and improving operating performance this year," CEO William Martin said in a statement.
The company at June 30 had $223.3 million in loans, cash and other assets; and $131.6 million in deposits. That left the company with a strong stockholders’ equity position of $89 million.
Nonperforming assets such as bad loans totaled $14.1 million or 6.3 percent of assets, up from $13.8 million or 5.4 percent at the beginning of the year.
"We continue to work with borrowers to resolve problem assets and we have had a number of successes this year. Until the greater Las Vegas economic recovery begins to gain traction, however, we will continue to focus on asset quality," Martin said in today’s report.