Published Jan. 23, 2013
Palmetto Bancshares Inc. reported net income of $2.7 million for the fourth quarter, its second straight quarterly profit after around three years of losses.
For the full year, the Greenville-based holding company of Palmetto Bank lost $1.9 million, compared with a $23.4 million loss in 2011.
“Over the past year we significantly reduced problem assets, improved our operating efficiency, and enhanced the delivery of products and services to our clients. We enter 2013 with positive momentum and are continuing our focus on enhancing the client experience and further improving our profitability,” company CEO Samuel L. Erwin said in a news release.
The company lost more than $133.5 million from the second quarter of 2009 to the second quarter of 2012, before reporting net income for the third quarter.
During the fourth quarter, credit-related expenses increased to $3.4 million on charge-offs and writedowns on problem loans. Nonperforming assets decreased by $4.7 million to $26.8 million, which represents an 81% decline from the peak at March 31, 2010 and the 10th quarterly decline in the last 11 quarters. The allowance for loan losses coverage ratio was reduced to 2.41% of gross loans from 2.50% at Sept. 30.
Net interest margin declined nine basis points to 3.5%. Net interest income decreased $160,000 to $9.7 million due to higher interest income reversals primarily on one loan placed on nonaccrual status and a decline in loan and investment securities yields, the company said.
“During the fourth quarter 2012 we continued to focus on increasing revenues through additional commercial banking products and services such as Small Business Administration lending, corporate banking and eTreasury services,” Erwin said. “We also improved electronic delivery of our retail banking services through an enhanced online banking platform, mobile banking and deposit-accepting ATMs at select locations. In addition, we better leveraged our wealth management services to existing clients and are engaging proactively in business development efforts.”
The Palmetto Bank has assets of $1.1 billion and operates 25 branch locations in the nine counties of Abbeville, Anderson, Cherokee, Greenville, Greenwood, Laurens, Oconee, Pickens and Spartanburg.