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Crescent Financial Corporation Releases Fourth Quarter/2010 Results

Stocks in this article: CRFN

CARY, N.C., Feb. 23, 2011 (GLOBE NEWSWIRE) -- Crescent Financial Corporation (Nasdaq:CRFN), parent company of Crescent State Bank headquartered in Cary, N.C., announced an unaudited net loss for the three months ended December 31, 2010, before adjusting for the effective dividend on preferred stock, of ($4,523,000) compared with a net loss of ($32,047,000) for the three month period ended December 31, 2009. After adjusting for dividends and accretion on preferred stock of $425,000 and $604,000, respectively for each period, the net loss attributable to common shareholders for the current period of ($4,948,000) or ($0.52) per diluted share compared to a net loss attributable to common shareholders of ($32,651,000) or ($3.41) per diluted share for the prior year period. Results for the fourth quarter of 2010 include the impact of recording a $2,104,000 deferred tax asset valuation allowance which reduced the income tax benefit for both the quarter and the year. Results for the fourth quarter of 2009 included the non-cash write-off of $30,233,000 of goodwill associated with two prior bank acquisitions. The losses recorded during the fourth quarter of both 2010 and 2009 were also impacted by elevated loan loss provisions.

Net Interest Income

Net interest income for the three-month period ended December 31, 2010 decreased by more than $1.0 million to $6.6 million compared with $7.7 million for the three-month period ended December 31, 2009. The yield on average earning assets decreased by 51 basis points from 5.75 percent to 5.24 percent. The decline is attributable to lower yields on loans due in part to interest reversals and foregone interest income on nonaccrual loans. The cost of interest bearing deposits declined from 2.84 percent in the prior year period to 2.21 percent for the quarter ended December 31, 2010. Total interest-bearing cost of funds declined to 2.46 percent from 2.87 percent. The tax equivalent net interest margin was 3.03 percent for current quarter compared to 3.21 percent for the quarter ended December 31, 2009. The decrease in net interest margin was the combined result of a lower net interest spread and a decline in the percentage of average earning assets to average interest bearing liabilities.

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