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First Place sees improvement
By GRACE WYLER
warren
Despite continued losses due to bad loans, First Place Financial Corp. saw signs of improvement last quarter as the company makes efforts to address troubled assets and expand its mortgage business.
“Our strategy here has been to continually focus on asset quality,” company president Steven Lewis said in a conference call with investors Friday. “It is very possible that we will reach profitability next quarter.”
First Place Financial, parent company of First Place Bank, said this week it recorded an $11.9 million loss for the fourth quarter of the fiscal year, which ended June 30. Earnings improved compared with a $13 million loss for the prior quarter and a $12.7 million loss for the same quarter last year.
The company reported a net loss of $30.3 million for the fiscal year, compared with a $110.4 million loss in the 2009 fiscal year. The majority of the 2009 loss was the result of a $93.7 million accounting charge the company had to take because of decreases in the value of previous bank acquisitions.
The change from 2009 to 2010 was due partly to a $43.6 million increase in the provision for loan losses, as the company continued to struggle with troubled assets in the commercial-loan portfolio, First Place officials said.
The company aggressively pursued the resolution of problem assets in the second half of fiscal year 2010, Lewis said, and nonperforming assets and delinquent loans reached their lowest point since the end of March 2009 in the fourth quarter of fiscal year 2010.
The bank recorded $132,759 in nonperforming assets in the fourth quarter, compared with $140,018 in the same quarter in 2009. Total delinquent loans were $129,109, down from $147,624.
Improved interest margins and gains from the company’s mortgage business offset increased loan loss provisions in fiscal year 2010, Lewis said.
The company had a record year in mortgage banking, with a 40 percent increase in mortgage-banking gains over 2009, the company’s previous record.
First Place has continued to focus on expanding its mortgage business, and the growth is expected to continue into fiscal year 2011, Lewis said.
This weekend, First Place Bank will see the culmination of its Race To First Place marketing campaign, which began last summer in anticipation of the launch of the Chevrolet Cruze at the General Motors Lordstown plant. The bank will give away three Cruzes to the winners of the sweepstakes.
The first Cruze will be awarded today during the GM Pepsi Cruze-In at the Warren Community Amphitheater.
The Warren-based bank has 43 retail sites and 21 lending centers throughout Ohio, Michigan, Indiana and Maryland.