Signature Bank's 1Q Profit Falls On Dividend Costs

NEW YORK (AP) — Signature Bank said Tuesday its first-quarter profit available to common shareholders tumbled 75 percent, due to preferred dividends payments related to the federal government's investment in the bank.

Net income for the quarter ended March 31 fell to $2.4 million, or 7 cents per share, compared with $9.9 million, or 33 cents per share.

Excluding $12.2 million spent to pay preferred dividends, Signature Bank earned $14.6 million, or 41 cents per share, during the first quarter.

Analysts polled by Thomson Reuters, on average, forecast earnings of 36 cents per share for the quarter. Analysts typically exclude special items in their estimates.

The preferred dividend costs were tied to the government's investment in the bank as part of the Treasury Department's $700 billion program launched last fall to help unclog the stagnant credit markets. Signature Bank received $120 million as part of the program, known as the Troubled Asset Relief Program. All banks that received TARP funds have seen their net income reduced during the first quarter because of the preferred dividend payments on the government's investment.