A sizable cut in operating expenses and foreclosure-related costs helped the owner of Tidelands Bank turn a small profit for the first quarter of the year.
Mount Pleasant-based Tidelands Bancshares Inc. said it earned about $24,000 in the January-March period, or a penny a share, after factoring out preferred dividends. That compared to a net loss of nearly $4.5 million, or $1.09 a share, for the first quarter of 2011.
The company said it was able to return to profitability partly because it did not have to stash as much money in its reserves to cover future bad loans. The set-aide provision totaled $225,000 for the first quarter compared to more than $4.2 million for the first three months of 2011.
Also, Tidelands said it cut operating expenses by about $737,000, or 17 percent, from a year ago.
Much of the reductions came from two areas. Tidelands said salaries and benefits fell by $317,000, according to a filing with the Securities and Exchange Commission.
Also, costs related to the process of repossessing homes and other real estate collateral fell by about $316,000 from the first quarter of 2011.
Thomas Lyles, the bank’s president and chief executive officer, could not be reached for comment Tuesday.
Tidelands operates seven branches from along the South Carolina coast.
The bank has been hurt by the downturn in the real estate and construction businesses. It has been operating under a consent agreement with industry regulators since late 2010 that calls for Tidelands to raise more capital.
Total assets for the company were $547.6 million on March 31, an increase of $13.5 million from Dec. 31. Loans declined about $4.5 million while deposits climbed by $13.6 million.
Separately, Tidelands has scheduled its annual meeting of shareholders for May 23.
Shares of the company were unchanged Tuesday at 22 cents.
Reach John P. McDermott at 937-5572.