DOW JONES NEWSWIRES
Marshall & Ilsley Corp. (MI) swung to a first-quarter loss
on another increase in its loan-loss provisions amid credit
woes.
Wisconsin's largest bank has been cutting costs by eliminating
jobs and slashing its dividend as it looks to preserve cash. Its
problems stem not only from its struggles with heavy exposure to
some of the most troubled housing markets, but also from its
especially large exposures to commercial construction loans.
The company's shares were up 5.6% at $7.59 in premarket
trading.
Marshall & Ilsley posted a net loss of $116.9 million, or 44
cents a share, compared with year-earlier net income of $46.2
million, or 56 cents a share.
The latest results included a net gain of 10 cents a share from
a tax benefit, which offset dividends paid to the Treasury
Department under the Troubled Asset Relief Program.
Analysts polled by Thomson Reuters expected a loss 33 cents a
share.
The company didn't provide revenue figures.
Loan-loss provisions rose 56% from the prior quarter to $1.33
billion. Charge-offs, or loans thought not to be collectible, rose
to 2.67% of average loans and leases from 1.08% in the prior
quarter. Nonperforming loans, or those near default, rose to 5.15%
of total loans and leases from 3.62% in the prior quarter.
In a contrast to many major banks, Marshall & Ilsley said
last month it would extend its moratorium on foreclosures as it
looks to keep homeowners in their homes and keep those loans from
going bad.
The company's tangible common equity ratio, which measures how
much of a bank's hard assets its common shareholders actually own,
was 6.4%. It didn't give prior figures.
-By Kerry E. Grace, Dow Jones Newswires; 201-938-5089;
kerry.grace@dowjones.com
