Bar Harbor Bankshares Reports Fourth Quarter 2008 Impairment Charge
20 Februar 2009 - 10:38PM
Business Wire
Bar Harbor Bankshares (the �Company�) (NYSE Alternext US: BHB)
the parent company of Bar Harbor Bank & Trust, today announced
that, as a result of obtaining information relative to collateral
loss experience on certain of its non-agency 1-4 family
mortgage-backed securities after its February 2, 2009 announcement
of year-end 2008 results of operations and before filing its Annual
Report on Form 10-K, it will record in the fourth quarter an
other-than-temporary impairment charge with a pre-tax impact on
2008 earnings amounting to $1.4 million. This non-cash charge will
reduce the Company�s previously announced 2008 net income by $876
thousand, or $0.29 per diluted share.
Because these investment securities were carried at fair value
at December 31, 2008, estimated losses on these investment
securities, net of tax, were previously recorded in unrealized
losses on securities available for sale within accumulated other
comprehensive loss, a component of total shareholders� equity on
the Company�s consolidated balance sheet. This non-cash charge will
reduce the Company�s full-year 2008 net income to $7.7 million, or
$2.57 per diluted share, from $8.6 million, or $2.86 per diluted
share, as previously announced. For the fourth quarter of 2008,
this non-cash charge will reduce its previously announced net
income to $1.4 million, or $0.48 per diluted share, from $2.3
million, or $0.78 per diluted share.
The $1.4 million non-cash impairment charge represents 0.1% of
the Company�s total assets and 0.5% of the Company�s total
investment securities as of December 31, 2008.
Despite the foregoing other-than-temporary impairment charge,
the Company will report record earnings and earnings per share for
the year ended December 31, 2008. The Company will report increases
in 2008 net income and fully diluted earnings per share of $576
thousand and $0.27, or 8.1% and 11.7% respectively, compared with
the year ended December 31, 2007. The return on average
shareholders� equity will amount to 11.89%, compared with 11.04% in
2007. The Company will be filing its 2008 Annual Report on Form
10-K on or before March 16, 2009.
In making the announcement, the Company�s President and Chief
Executive Officer, Joseph M. Murphy commented, �Based on our
assessment of the other-than-temporarily impaired securities, we
are of the belief that the ultimate economic losses that may be
realized for these securities may be meaningfully less than the
�mark to market� losses currently required by U.S. GAAP accounting
rules. Company management believes that the difference between the
expected losses and the mark-to-market losses are largely
attributed to market liquidity, massive de-leveraging, and the
historical disruption in the financial markets in general.
In concluding, Mr. Murphy added, �Considering the Company�s
strong balance sheet, liquidity position, earnings fundamentals and
capitalization, we believe we are well positioned to successfully
navigate our way through the many uncertainties that lie ahead for
the banking and financial services industry through 2009 and
beyond.�
About Bar Harbor Bankshares
Bar Harbor Bankshares is the parent company of its wholly owned
subsidiary, Bar Harbor Bank & Trust. Bar Harbor Bank &
Trust, founded in 1887, provides full service community banking
with twelve branch office locations serving downeast and midcoast
Maine.
This earnings release contains certain forward-looking
statements with respect to the financial condition, results of
operations and business of Bar Harbor Bankshares (the �Company�)
for which the Company claims the protection of the safe harbor
provided by the Private Securities Litigation Reform Act of 1995,
as amended. You can identify these forward-looking statements by
the use of words like �strategy,� �anticipates� �expects,� �plans,�
�believes,� �will,� �estimates,� �intends,� �projects,� �goals,�
�targets,� and other words of similar meaning. You can also
identify them by the fact that they do not relate strictly to
historical or current facts. Forward-looking statements include,
but are not limited to, those made in connection with estimates
with respect to the future results of operation, financial
condition, and the business of the Company which are subject to
change based on the impact of various factors that could cause
actual results to differ materially from those projected or
suggested due to certain risks and uncertainties. These risks and
uncertainties include, but are not limited to, changes in general
economic conditions, interest rates, deposit flows, loan demand,
internal controls, legislation or regulation and accounting
principles, policies or guidelines, as well as other economic,
competitive, governmental, regulatory and accounting and
technological factors affecting the Company�s operations. The
Company assumes no obligation to update any forward-looking
statements as a result of new information or future events or
developments.
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