STARKVILLE — Cadence Financial Corporation reported net income of $664,000, for the fourth quarter of 2009, compared with a loss of $2.7 million for the fourth quarter of 2008. Net income applicable to common shareholders was $12,000 for the fourth quarter of 2009 after considering the effect of $652,000 in dividends and accretion on preferred stock.
“We are pleased to see income growth in 2009’s fourth quarter considering the challenges we have faced for the past year and a half,” said Lewis F. Mallory Jr., chairman and CEO of Cadence Financial. “We registered our lowest provision for loan losses in two years and our improved results are due in part to reducing our exposure to higher risk loans over the past year and strengthening our allowance for loan losses to cover problem credits.
“We also reported a lower level of charge-offs in the fourth quarter than any quarter this year; however, the weak economy continues to put pressure on our loan portfolio as reflected by the increase in nonaccrual loans and other real estate owned (OREO) compared with the linked third quarter of 2009.
Cadence’s provision for loan losses was $2.9 million in the fourth quarter of 2009 compared with $10.6 million in the same period last year. Net charge-offs were $4.4 million in the fourth quarter of 2009 and were down substantially from net charge-offs of $22 million in the third quarter of 2009 and $8 million in the fourth quarter of 2008.
At December 31, 2009, the allowance for loan losses was $43.4 million, or 4 percent of total loans, compared with $44.9 million in the third quarter of 2009, or 3.8 percent of total loans, and $20.7 million, or 1.6 percent of total loans, in the fourth quarter of 2008.
Cadence reported a net loss applicable to common shareholders of $112.2 million, or $9.42 per diluted share, in 2009 compared with a net loss of $3.4 million, or $0.28 per diluted share in 2008.