Bank of the Cascades finally released their 2009 results this week. The company lost $3.32 per share ($93 million) last year, roughly six times more than the current stock price. Nearly the entire loss can be attributed to its residential construction loans where troubles seem to be moderating somewhat.
Duncan writes today, “if CACB is exposed to commercial real estate loans, their troubles may only be beginning.” Well, Dunc, if you consider $675 million in commercial real estate (CRE) loans “exposure” then I guess we can safely assume the company will face continued problems in their loan portfolio:
At 44%, CRE loans make up by far the single largest portion of the company's overall portfolio (and the largest relative weight since at least 2005). Last year CACB charged off only $7.9 million in bad CRE loans and ended the year with a mere $8.9 million reserved for future losses. I guess, CRE has so far been relatively benign for the company.
With such massive holdings, however, should CRE go the way of residential real estate the bank will be devastated. Is it any wonder then, that the feds demanded the company raise $150 million in new capital?
Disclosure: no position