Harleysville reports $4.4 million quarterly loss; $222M loss for 2009
Harleysville National Corp. (NASDAQ:HNBC) reported today a net loss of $4.4 million or $.10 per diluted share for the third quarter of 2009. This compares to net income of $6.6 million, or $.21 per diluted share, for the third quarter of 2008.
For the nine months ended Sept. 30, 2009, net loss was $222.3 million or $5.16 per diluted share. Excluding the non-cash goodwill charge of $214.5 million recorded in the second quarter, the net loss was $7.7 million or $.18 per diluted share, compared to net income of $21.3 million or $.68 per diluted share during the comparable period in 2008.
Third quarter results included a $14.8 million provision for credit losses; a $4.7 million non-cash other-than-temporary impairment (OTTI) charge on investment securities; as well as professional fees of $2.4 million associated with recent corporate finance activities, including the pending merger with First Niagara Financial Group, Inc. ("First Niagara"), which is expected to close during the first quarter of 2010.
Paul D. Geraghty, President and CEO, Harleysville National Corporation, said, "We are carefully managing our loan portfolio to preserve and protect the bank's capital base, and minimize increases in delinquencies and non-performing assets, while also working hard to grow our franchise. To this end, during the third quarter we increased our penetration of retail and business accounts, grew non-municipal core deposits, and continued to expand sales of electronic banking services. We were also encouraged by the full payoffs of two nonperforming loans totaling $18 million after quarter end. The payoffs virtually offset the increase in nonperforming loans over the linked quarter."
During the third quarter of 2009, provision for loan losses was $14.8 million, compared to $2.6 million in the third quarter of 2008 and $32.0 million in the second quarter of 2009. The increase in provision for loan losses reflects an increase in nonperforming assets to $153.7 million at September 30, 2009, up from $138.9 million at June 30, 2009 and $38.8 million from a year ago.