Oh, how the mighty have fallen.
The South Financial Group, South Carolina’s largest state-based financial services company, closed Thursday at less than a dollar a share as the Greenville-based bank company’s free-fall accelerated.
South Financial, the parent of Carolina First Bank, closed trading at a stunning 95 cents a share, down 28 cents for the day, or nearly 23 percent. Compare that to just a year ago, when South Financial hit a high of $16.29.
The past 12 months have been difficult for South Financial. Last month, it announced it lost $319 million during fourth quarter 2008 and $569 million during the year as a whole. In addition, the entire banking sector as a whole has staggered over the past few months.
South Financial has been stung by the slumping Florida real estate market. It received a $347 million bailout by the US Treasury Department last year.
Earlier this month, South Financial named Lynn Harton chief executive and president. Harton replaced founder Mack Whittle, who left the company last year after receiving a hefty golden parachute.
In an absolutely unsurprising turn of events, Kim Jong Il has secured a nomination as a candidate to the North Korean 12th Supreme People’s Assembly.
The North Korean dictator was jubilant in the “faith” shown in him by his constituents.
“I extend my searing thanks to the entire electorate of the country for expressing their deep trust in me,” he said in a prepared statement.
According to The Times of London, He went on to add: “I will repay the high expectations of the entire electorate by devoting everything to making the fatherland powerful and prosperous and to making people happy by being around our soldiers and people at all times.”
(Editor’s note: what more could possibly be done to make the Fatherland any more powerful and prosperous? And what citizen doesn’t in their right mind doesn’t like being around soldiers, especially when they’re being held against their will in famine-ridden police state where early death is seen as a blessing?)
Before anyone gets their hopes up about democracy somehow infiltrating that miserable little country, The Times offers this pertinent bit of background on the North Korean legislative body in question:
“The Supreme People’s Assembly is not one of the world’s livelier or more competitive legislatures. Its 687 members meet only twice a year for a few days at a time, and approve without demur the proposals put before them. Its members come from several parties, but none that disagree with the line of the Korean Workers’ Party. All candidates have to be approved in advance by a body called the Democratic Front for the Reunification of the Fatherland, and debate or dissension are unknown.”
For those of you keeping score at home, voting will take place March 8. The early money looks for Kim Jong Il to retain his seat.
The new year hasn’t been a happy one for SCBT Financial stockholders. They’ve seen SCBT shares fall from nearly $34 on the first trading day of the year to just over $21 as of Wednesday. That’s a drop of approximately 37.5 percent in less than two months.
The plunge accelerated Wednesday as SCBT lost $1.38 before closing at $21.09. At one point, it dipped as low as $20.75, a 52-week low, before rebounding slightly.
While bank stocks around the country are taking a beating, SCBT’s free-fall is somewhat surprising. Unlike many South Carolina bank companies, the parent of South Carolina Bank & Trust managed to turn a profit last year, even if earnings were down from 2007.
SCBT posted net income of $3.5 million for the three months ending Dec. 31, 2008, compared to $5.1 million for the same period in 2007. For all of 2008, it earned $15.8 million, compared to $21.6 million the previous year.
While SCBT did receive nearly $65 million in federal bailout money earlier this year, that doesn’t fully answer questions as to what’s been driving the bank company’s stock price into the ground in 2009.
SCBT shares are still well above those of such local competitors as South Financial Group, First Financial Holdings and First Community Corp., but a 37.5 percent drop in a matter of weeks is the kind of thing that leaves brokers and investors alike scratching their heads and wondering if it isn’t time to get out of the banking sector all together.