Saturday, October 30, 2010

Tennessee Commerce has $1.5M loss, bad loan

Franklin-based business bank Tennessee Commerce Bancorp lost $1.5 million in the third quarter, the company said Friday, and the bank also reported one bad $17.3 million loan to an undisclosed client.
The 16-cents-a-share loss was a surprise to stock analysts, who had expected on average a profit of 12 cents a share, according to Thomson Financial.

The bank's stock lost 19 cents a share, or nearly 4.4 percent, and closed at $4.17 a share in trading Friday on the Nasdaq.

News of the poor-performing quarter was a change from previous quarters of the past year, in which Tennessee Commerce had managed to squeeze out a profit. A year ago, Tennessee Commerce made $1.2 million after paying preferred dividends.

The bank's president and CEO, Mike Sapp, blamed the latest quarter's results on "nonrecurring" items such as the large bad loan. Nonperforming assets grew by more than $12 million from the previous quarter to $86.5 million, the bank said. Income from fees and interest grew during the quarter.

"While our customers remain cautious, we are optimistic that earnings momentum will grow in a more straight-line manner going forward,'' Sapp said in a statement.

Contact business reporter Naomi Snyder at 615-259-8284

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