First Place reports lower earnings
By Don Shilling
First Place earned $2.9 million, down from $5.6 million.
WARREN — First Place Financial Corp. reported lower earnings and a 50 percent cut in its quarterly dividend.
The Warren-based parent company of First Place Bank said Tuesday that it earned $2.9 million in the quarter that ended June 30, compared with earnings of $5.6 million in the same quarter last year.
The company said the decrease in earnings came from a $1.5 million increase in money it sets aside for loan losses and from a $1.4 million accounting charge for a decrease in value of investment securities.
First Place set aside $4.6 million for loan losses in the quarter as it continues to review its outstanding loans.
Its nonperforming assets stood at $74.4 million on June 30, compared with $40.7 million a year earlier. This includes loans that haven’t been paid on in 90 days and real estate owned by the company.
First Place wrote off $5.4 million in loans in the most recent quarter, which was up from $1.2 million in the same quarter last year.
Steven Lewis, First Place president and chief executive, said this amount rose because the bank has been aggressive in taking possession of homes that are in default, rather than forcing a borrower into foreclosure. This has increased the amount of loans being written off but helps get the homes on the market quicker, he said.
He added that he thinks the market will be helped with the addition of more workers at General Motors’ Lordstown plant, which is adding a third shift.
The board of directors declared a dividend of 0.085 cents, which is payable Aug. 14. The previous dividend was 17 cents.
The board wanted to have more capital to invest in future growth or retain for bank use, Lewis said.
“Retaining more capital in the bank is the prudent thing to do given the current economic environment,” he said.
shilling@vindy.com