PremierWest Bancorp ( PRWT) of Medford, Ore. is the smallest among the ten most actively-traded bank and thrift holding companies selling for less than tangible book value as of Thursday's close, with total assets of $1.5 billion as of March 31. Shares closed at 46 cents Thursday, or 0.8 times tangible book, and were down 67% during 2010. TARP Status: PremierWest owes $41.4 million in TARP money and has missed two quarterly dividend payments on government-held preferred shares. Capital: The holding company completed a $33.3 million common stock offering in April. Proceeds of the offering received through March 31 brought the company's Tier 1 leverage ratio to 8.21% and its total risk-based capital ratio to 11%. Terms of an April 6 Cease and Desist order from the FDIC require main subsidiary PremierWest Bank to achieve and maintain a Tier 1 leverage ratio of 10% within 180 days. Since the bank subsidiary's Tier 1 leverage ratio was also 8.21% as of March 31, it appears another capital raise will be needed. Earnings: PremierWest Bancorp reported a net loss to common shareholders of $3.3 million, or 10 cents a share, for the first quarter, after losing $148.6 million or $6.01 a share during 2009. The two main factors in the 2009 loss were $88 million in provisions for loan loss reserves and a fourth-quarter non-cash goodwill impairment charge of $74.9 million. Asset Quality: The nonperforming assets ratio was 8.31% as of March 31, down slightly from the previous quarter. PremierWest's net charge-off ratio for the first quarter was 1.93%, which was its lowest level in a year. Loan loss reserves covered 4.16% as of March 31. There were some bright signs for asset quality, but "adversely classified loans" were still increasing. These include nonperforming loans, as well as performing loans with "a well-defined weakness or weaknesses related to the borrower's financial capacity or to pledged collateral that may jeopardize the repayment of the debt." For commercial real estate borrowers whose loans are maturing, there may not be sufficient collateral to support a loan renewal, or a new loan from a different lender. Adversely classified loans comprised 26% of total loans as of March 31. Prospects: PremierWest completed a significant capital raise in April, however, the company will probably need to raise capital again to comply with the FDIC order. Investors considering the shares should wait until third-quarter numbers are available. At that point, the company's asset quality picture may have improved, and hopefully it will have achieved the capital ratios mandated by regulators.