While loan quality has declined, especially over the past three quarters, Riverside's losses during the past 12 months have come mainly from write-downs on investment securities, beginning with preferred shares of
, which were unexpectedly wiped out when the government-sponsored enterprises were place under conservatorship in September 2008.
Regulatory requirements to essentially write-down to zero certain securities downgraded below investment grade by the ratings agencies have also hurt the bank's risk-based capital calculations.
Executive Vice President Alan Polackwich told
that Riverside "is actively seeking capital, and we have multiple parties that appear to be quite interested."
Florida Banks With Weakest Loan Quality
Since there were 42 Florida banks and thrifts with nonperforming assets comprising more than 10% of total assets as of June 30 (second only to Georgia, which had 45), we're limiting the list to the nine institutions with nonperforming assets above 15%:
Source: Regulator filings via SNL Financial.
A total of 15 Florida institutions were included in the list of
Undercapitalized Banks and Thrifts
as of June 30.
Two of the Florida banks on the undercapitalized list included
Florida Community Bank
of Immokalee and
Hillcrest Bank Florida
of Naples. P/>
Free Financial Strength Ratings
Along with TARP, the temporary increase of the FDIC's basic limit on individual-deposit-insurance coverage to $250,000 from $100,000 has curtailed bank failures. This increase has been extended through 2013.
The FDIC's temporary waiver of all deposit insurance limits for business-transaction accounts (checking accounts) has also mitigated the risk of deposit flight. This waiver is set to expire on June 30, 2010, after which business-checking accounts will revert to the $100,000 limit.
This means it will be more important than ever for businesses and municipal entities such as school districts to carefully monitor the health of their banks. It's very easy to have more than $100,000 of somebody else's money flowing through a business account.
issues independent and conservative financial-strength ratings on each of the nation's 8,500 banks and savings and loans. They are available at no charge on the
Banks & Thrifts Screener
The writer owns shares in Riverside Banking Co., the holding company for Riverside National Bank of Florida, a former employer.