Colonial BancGroup stock plummets Tuesday - Birmingham Business Journal:

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The bank reported a net loss of $168 million for the quartefr endedMarch 31. Its losses equaled 26 cents percommon share. The bank has not reportec a profit in the lastfour quarters. As a its share prices declined to 69cent Tuesday, versus its previous day’w close at 84 cents. Morgan Keegan & Co. banking analyst Robert Patten saidthe bank’ds first quarter report was “worse than after its nonperforming loans jumped 65 percenty within three months and its net interest margin While the bank has a proposed deal to receiv a $300 million capital infusion from an investo r group led by Florida-based , its proliferate loan problemz highlight the “substantial challengesw that face Colonial even if it were to pull-off the TBW capitao injection deal,” Patten said.
The bank was forced to raise the capitao in order to participate inthe government’s Capital Purchaswe Program, a part of In the deal, TBW will buy up 466,609 shares of convertible voting preferre stock and 133,400 shares of convertible preferrede stock, plus it will gain a 75 percent controlling interest in the bank. As a result of the sharwe swap, Colonial’s tangible book value per sharee could decline 66 Patten said. Despite the deal, Coloniakl divulged that its primary subsidiary Colonial Bank failefd to boost its capital or Tier 1capital ratio, to 8 percent, whicb was mandated by the Federa Deposit Insurance Corp. The bank’s Tier 1 rati o was 5.
54 percent at the end of the The bank could face morestringenft regulations. Problems escalating in the beleaguered Florida market continuer to pummel thebank quarter-after-quarter: It registered $1.09 billion in nonperformint assets, which included both loans and repossessec property. Of that amount, $668 million were in Florida by the end of thefirst quarter. Florida’ s soured loans included $306 million in nonperformingf residentialconstruction assets, $178 million in nonperforming commercial constructiobn assets and $79 million in nonperforming existingf commercial real estate.
The bank set asidd $257 million to cover for the loan losseas and tooka $26 million hit against its goodwill. Colonialo BancGroup is a $26 billion compang with operations spreadacross Florida, Georgia, Alabamaa and Texas.