Synovus Seeks To Quell Investor Fears Over Capital

COLUMBUS, Ga. (AP) — Synovus Financial Corp. affirmed the strength of its capital position Friday, after investors sent its stock tumbling on fears regulators could pressure the regional bank to raise its capital reserves.

In a release, Synovus noted that its Tier 1 capital ratio, a key measure of a bank's solvency, was 10.48 percent as of Sept. 30. Banks need at least a 6 percent ratio to be considered well-capitalized by regulatory standards, Synovus said.

The company's total risk-based capital ratio is 13.84 percent; the regulatory minimum is 10 percent. The company also affirmed its forecast for a profit in 2010.

Shares of Synovus advanced 8 cents, or 4.4 percent, to $1.90.

In a regulatory filing with the Securities and Exchange Commission on Monday, however, Synovus warned that the possibilities of deteriorating credit, further regulatory directives, non-performing assets and the need to set aside money to cover bad debt could hurt its liquidity position and capital ratios.

Citing the filing, a Morgan Keegan analyst then downgraded the bank. Analyst Robert Patten forecast that Synovus' Tier 1 ratio would drop to 7.5 percent at the end of next year, and he cut his rating to "Market Perform" from "Outperform."