Citizens Bank rebounds with profit
Senior Staff Writer
After 18 months of losses, locally-owned Citizens Bank of Northern California showed a $363,000 profit for the third quarter, ending Sept. 30.
The bank that started in Nevada County in 1995, is still showing an overall net loss of almost $1.7 million for the year through Sept. 30, according to a statement released Thursday.
According to the financial report, losses have totalled $12.8 million since January, 2008, so the third quarter numbers are reassuring.
“It feels good. We’re back in the black and expect it to continue,” said CEO/President Gary Gall. “I’m glad to see we were able to get things turned around. As we persevere through these tough economic times, I attribute the success of this last quarter to a loyal community and customer base.”
Citizens Bank’s troubles have followed the economic downturn, resulting in several loan defaults and foreclosures. It did receive more than $10 million through the Federal Troubled Asset Relief Program (TARP) that it must eventually repay.
At the end of December last year, the bank had $34 million in “nonperforming assets,” according to the statement. Those assets are loans that are in foreclosure, or delinquent.
The non-performing assets were at $39.1 million as of Sept. 30, which represents almost 5 percent of all loans, but the bank is not ready to walk away from them just yet.
“We are continuing our efforts in resolving past due loans and disposing of foreclosed properties,” Gall said.
Earlier this year, an internal and federal audit found that many of the loans were based on inflated values of borrowers’ collateral and financial prior to the economic downturn.
That caused the bank to reassess the loans and then reissue its financial statements in June. The new figures showed the original losses of $7.4 million had climbed to almost $12.8 million.
To contact Senior Staff Writer Dave Moller, e-mail firstname.lastname@example.org or call 477-4237.
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