Eastern Virginia Bankshares (NASDAQ:EVBS) today reported its results of operations for the three and six months ended June 30, 2010 and announced a dividend declaration.
After a process of evaluating our credit portfolio in this difficult economic environment, and in light of recent evidence that suggests that economic growth may remain weak for an extended period, EVBS announces that it has significantly increased its provision for loan losses. While this action has an immediate recognition of a loss for the quarter and the results of operations year to date, it is necessary as we aggressively identify and resolve our problem loans.
For the three months ended June 30, 2010, EVBS reported a net operating loss of ($6.0) million, an increase of $4.2 million over the net operating loss of ($1.8) million reported for the same period of 2009. The net loss to common shareholders increased to ($6.3) million, or ($1.06) per common share, assuming dilution, compared to a net loss of ($2.1) million or ($0.36) per common share in 2009. For the first six months of 2010, the net operating loss was ($4.6) million, an increase of $3.6 million over the net operating loss of ($1.0) million reported for the same period of 2009. The net loss to common shareholders increased to ($5.4) million, or ($0.90) per common share, assuming dilution, compared to a net loss of ($1.8) million in 2009 or ($0.30) per common share. Continued economic weaknesses necessitated a significant increase in our provision for loan losses and was the primary driver of our financial results for the quarter. For the three and six months ended June 30, 2010 the provision for loan losses was $12.6 million and $14.5 million, respectively, as compared to $750 thousand and $1.7 million for the same periods of 2009. The difference between net operating loss and net loss to common shareholders is the deduction for the effective dividend to the U.S. Treasury on preferred stock.