Mount Pleasants Tidelands Bank owner has $2.6M loss
The owner of Tidelands Bank swung to a third-quarter loss as it continued to deal with the fallout from the coastal real estate downturn.
Mount-Pleasant-based Tidelands Bancshares Inc. reported a $2.6 million loss for the July-to-September period compared to a $1.4 million gain for the same quarter last year.
The holding company attributed most of the deficit to $2.2 million it set aside to cover potential shortfalls from questionable loans at the seven-branch bank. Reserve payments are not counted as profit.
“In the third quarter we had a couple of additional loan situations we had to deal with,” said Thomas Lyles, Tidelands’ CEO. “We had to make provisions for ‘possibilities,’ even though those are not actual losses at this point. Nonetheless, that’s the world we live in.”
The quarterly loss also included about $240,000 in dividends Tidelands owes the U.S. Treasury, which acquired stock in the company under the Troubled Asset Relief Program in 2008. The lender has been deferring those payments for the past two years to conserve cash, which is allowable under TARP.
Lyles said Tidelands remains adequately capitalized.
“The bank, without some of the burden and expense of the holding company, is doing better than the holding company,” he said.
Tidelands noted that the credit environment is steadily improving. This year the bank has cleared from its books $13 million in soured loans and other “nonperforming” assets, which peaked at $61 million in December.
“They are moving in the right direction,” Lyles said. “We just have to keep after them.”
Reach John McDermott at 937-5572.