NEW YORK (Reuters) – National City Corp (NCC.N: Quote, Profile, Research, Stock Buzz), a large Midwest regional bank, on Thursday posted a $1.76 billion loss, hurt by higher reserves for mortgage and real estate loans and a write-down for previous acquisitions.
The fourth straight quarterly loss for the Cleveland-based company equaled $2.45 per share, and compared with a profit of $346.6 million, or 60 cents per share, a year earlier.
Results included a $1.08 billion write-down of goodwill for prior acquisitions. National City also set aside $1.59 billion for loan losses, and net charge-offs totaled $740 million. The latter was tied mainly to a “liquidating” portfolio of lower-quality home loans that the bank might sell.
Excluding the goodwill write-down, the loss was 94 cents per share, and compared with the average analyst forecast for a loss of 20 cents per share, according to Reuters Estimates.
“We have made significant progress during the quarter in strengthening our balance sheet, mitigating losses in our liquidating portfolios and positioning National City for long-term growth when the credit cycle turns,” Chief Executive Peter Raskind said in a statement. “We have more than sufficient capital to ride out turbulent credit markets. We fully recognize that we need to improve performance.”
National City shares had fallen more than 85 percent in less than a year as mortgage losses drove the bank to raise $7 billion of dilutive capital from Corsair Capital LLC and other investors. It also slashed its dividend twice.
Shares of the bank closed Wednesday at $4.71 on the New York Stock Exchange. The shares have fallen 71 percent this year, compared with a 23 percent decline in the KBW Bank Index
(Reporting by Jonathan Stempel; Editing by Derek Caney)