Northwest Bancorporation, the parent of Inland Northwest Bank, reported losses for the fourth quarter and full-year 2008, and announced the sale of $10.5 million in preferred stock to the U.S. Treasury.
For the fourth quarter, Northwest registered a loss of $1.42 million, or 60 cents per share, compared with a profit of 31 cents per share in the 2007 period.
For the full year, the bank lost $275,000, or 12 cents per share, compared with a profit of $1.10 per share in 2007.
Northwest President Randall Fewel attributed the red ink to sharply increased provisions for loan losses; $2.95 million for the quarter and $3.95 million for the year. In 2007, the provisions were just $150,000 and $420,000, respectively.
Declining interest rates also squeezed net interest margins from 4.35 percent in 2007 to 3.56 percent in 2008, he said.
Northwest assets increased 16.4 percent during the year to $400.2 million. Net outstanding loans increased 21.7 percent to $334.3 million.
Fewel said he gave up his 2008 bonus and, along with the rest of the management team, agreed to a wage freeze.
He said the $10.5 million in Treasury funds will allow Inland Northwest Bank to continue loan originations, which climbed $120 million the last two years.
Ford to offer buyouts, cut executives’ pay
Hourly workers at Ford Motor Co. will get yet another round of buyout and early retirement offers, and the company’s top two executives will take 30 percent pay cuts as Ford tries to find a way out of the worst auto sales slump in 26 years.
Chief Executive Alan Mulally and Executive Chairman Bill Ford Jr. will see the salary reductions this year and next, according to a memo obtained by the Associated Press.
In addition, local union leaders were told Tuesday that the company will make buyout or early retirement offers to all 42,000 U.S. hourly workers. The offers are part of a series of contract concessions in a tentative agreement reached between the United Auto Workers and the company, according to two union officials briefed on the deal.
Troubled bank criticized over parties at golf event
Northern Trust Corp., a bank that received $1.6 billion in government funds, is facing scrutiny for hosting parties and other events connected to its sponsorship of a professional golf tournament.
Reports of the parties brought a swift protest from Washington, with Democratic lawmakers pressing the bank to return the money spent on the events, and Sen. John Kerry proposing legislation restricting banks that received government funds from hosting, sponsoring or paying for conferences or entertainment events.
Many banks that received money as part of the government’s $700 billion government package passed last fall have come under heavy criticism from politicians in Washington in recent weeks about their spending habits – from hosting conferences to buying corporate jets – after obtaining the funds.
The Chicago-based custody bank was the title sponsor of the PGA Tour’s Northern Trust Open that was played last week at Riviera Country Club in suburban Los Angeles.
The bank also hosted dinners and concerts for clients and employees who attended the weeklong event. A report by entertainment Web site TMZ said Northern Trust flew in hundreds of employees and clients for the event, putting them up at fancy hotels throughout the area and hosting dinners and concerts throughout the week of the tournament.
The events are part of the bank’s global marketing activities and are focused on showing appreciation for clients and attracting new business, said Douglas Holt, a spokesman for Northern Trust.