CommerceBancorp Reports a Second Heavy Annual Loss
NEWPORT BEACH — For the second year in a row, CommerceBancorp on Friday reported a heavy annual loss--$3.6 million--from expected loan defaults and a write-off of real estate loans that have lost value in the recession.
The holding company for Newport Beach-based CommerceBank said the loss of $1.53 a share exceeded its 1991 loss of $3 million, or $1.26 a share. Revenue for the year was $27.7 million, down 7% from $29.9 million the previous year.
“I think a significant portion of (the loss) is certainly recession related,†said Dale D. Walter, the company’s chief executive.
Like the previous year, the company was eking out a profit until the fourth quarter when it lost $3.7 million, or $1.59 a share. For the final quarter of 1991, it lost $3.6 million, or $1.52 a share. Fourth-quarter revenue fell 18% to $5.4 million last year from $6.6 million in 1991.
The drop in interest rates has also lowered overall revenue for the past two years.
Walters said CommerceBancorp has put aside $1.5 million in reserve for possible loan losses. It has also charged off $2 million for losses in the value of real estate it acquired by foreclosure. It also wrote off $1.2 million on other assets.
“These expenses, coupled with a decrease in net interest . . . contributed substantially to the company’s loss for the year,†Walter said. He said he hopes the company will turn around in the next year. CommerceBancorp stock, traded on the NASDAQ market, closed at $4 a share, unchanged from the previous day.
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