By Hanah Cho, The Baltimore Sun
7:40 PM EDT, October 28, 2011
First Mariner Bancorp posted a $7.9 million loss in the third quarter as the Baltimore company continued to write down the value of distressed properties.
The hemorrhaging comes as the parent of 1st Mariner Bank is seeking to raise capital and ensure its survival.
The most recent quarterly loss widened from a net loss of $4.7 million from a year ago. The company said earnings from the June-to-September period in 2010 were helped by a $4.5 million tax benefit. There was no such tax benefit this year.
First Mariner Chairman Edwin F. Hale Sr. said in a statement that the company continues to "face strong headwinds in the real estate market."
"Our costs associated with foreclosed properties remain high as declining appraised values have forced us to take write downs on these assets," Hale said.
Costs related to loan losses and foreclosed properties — reflecting the fallen values — amounted to $8.2 million in the quarter.
Meanwhile, First Mariner's average earning assets fell 13 percent from a year ago to $897.3 million.
Amid the continuing financial setback, First Mariner is up against a Nov. 30 deadline to raise nearly $124 million to close a deal that would give the company a much-needed boost to meet capital levels federal regulators have demanded.
In exchange for raising that money, New York-based Priam would also provide a $36.4 million cash infusion. But the investment firm could walk away from the deal if First Mariner does not meet the new deadline, which had been extended from Sept. 1.
Separately, the company announced that the bank's president, Daniel McKew, who joined the company a year ago, has resigned to pursue "another professional opportunity."
Mark Keidel, president of First Mariner and the bank's chief operating officer, who was hired in 2000, will succeed McKew, who was hired from SunTrust Equipment Finance and Leasing Corp. in Towson to expand 1st Mariner's commercial lending business.
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