TSFG posts larger-than-expected loss
The South Financial Group posted a loss of $90.8 million during the first quarter of 2009, including operating losses of $88.6 million, far worse than analyst expectations.
The operating loss works out to a per-share loss of $1.08. Analysts on average had expected the company to post a loss of 80 cents a share, excluding one-time items, according to Reuters.
The net loss was primarily driven by continuing high credit costs, including increasing the allowance for credit losses, the Greenville, SC-based company said in a press release.
As of March 31, 2009, nonperforming loans held for investment totaled $422.9 million, a $73.6 million increase from $349.4 million as of the end of 2008, South Financial said, adding that it had $12.8 million in nonperforming loans held for sale. Much of the increase was attributable to residential construction and housing-related loans, primarily in Florida.
South Financial, the parent of Carolina First Bank and the largest bank company based in South Carolina, is coming off the worst year since its inception in 1986. It lost $569 million in 2008 and saw its stock price fall from $15.67 a share to $4.31. It closed Tuesday at $1.84 a share and is expected to drop sharply Wednesday.
Also in 2008, founder and chief executive Mack Whittle “retired,” but not before getting a lucrative golden parachute worth at least $12 million, South Financial was hit with a pair of shareholder lawsuits and the company received $347 million in federal bailout funds.