AmericanWest to pull request for federal aid
Spokane-based bank hopes stance will draw investors
AmericanWest Bancorporation plans to withdraw an application for $57 million in federal assistance, the Spokane institution said Thursday in its first-quarter earnings release.
AmericanWest, which reported a net loss of $14.5 million, or 84 cents per share, said efforts to raise an equal amount of private-sector capital have fallen short, but added that discussions with investors continue.
The bank lost $4.6 million, or 26 cents per share, during the 2008 first quarter.
Chief Executive Officer Patrick Rusnak said investors remain leery of banks, but added that AmericanWest’s deposit base, loyal customers and staff, and aggressive efforts to address problem loans, will position the company well when capital markets improve.
“The fact we don’t have something done is not unique to AmericanWest,” he said.
Although money from the federal Troubled Asset Relief Program was relatively inexpensive, he said, TARP has many detractors.
“Some investors don’t even want to be in the same room,” said Rusnak, including some that may be willing to step in with more money now that the government is out of the picture.
He said AmericanWest could also improve some of its 58 branches in Washington, Idaho and Utah. The board of directors has already approved the terms of one proposal, he noted.
AmericanWest’s risk-based capital ratio is below the level required by regulators.
But Rusnak said smaller provisions for loan losses and charge-offs, $13.7 million and $17.7 million, compared with those taken in the fourth quarter of 2008, suggest the worst times may be behind AmericanWest.
Deposits were off only slightly from the end of the 2008 quarter, to $1.54 billion from $1.58 billion. Loans declined by 12 percent, to $1.52 billion, as AmericanWest reduced its exposure to commercial, industrial and construction lending.
Total assets as of March 31 were $1.8 billion compared with $2.1 billion a year ago.