The owner of Mount Pleasant-based Tidelands Bank reported a first-quarter net loss of $785,056, or 19 cents a share, including a $180,000 deferred dividend it owes the U.S. Treasury.
The results compared to a $1.14 million deficit from the previous quarter and a nearly $24,000 profit for the first quarter last year, Tidelands Bancshares Inc. said in a filing with the Securities and Exchange Commission.
The bank owner said it set aside $185,000 in its reserve fund to cover potential loan losses for the January-March 2013 period. Its portfolio of repossessed real estate was valued at $22.5 million at the end of March, essentially flat compared to Dec. 31.
The $180,000 dividend stems from Tidelands’ sale of $14.5 million in preferred stock to Treasury under the Troubled Asset Relief Program. It has been deferring those quarterly payouts since late 2010 to conserve cash, but it is obligated to pay them in full. They cumulative unpaid total has grown to about $1.8 million.
The government gave banks the latitude to take a break from their TARP dividends when it started investing in the industry to help steady the nation’s near-crippled financial system amid the 2008 meltdown.
The seven-branch Tidelands has struggled to rebound from the sharp real estate downturn that socked many lenders in South Carolina, especially along the coast. The bank has offices from the Hilton Head Island area to Myrtle Beach, though most of its business is concentrated in the Charleston region.