Sun Bancorp Inc. reported a $67.1 million net loss for the first quarter, as it sold off more than $174 million of loans at a loss. The bank reported a $762,000 loss in the year-ago quarter.
The Vineland-based parent of Sun National Bank agreed to sell $174.3 million of loans, with a book balance of $159.8 million, to an unidentified investor for $99.2 million. In total, $179.9 million of loans were transferred to held-for sale at a net loss of $53.1 million in the first quarter, Sun announced.
“The actions taken in the first quarter of 2011 advance the strategy that we set in motion in 2010 to strengthen Sun and grow the franchise,” said Sun CEO Thomas X. Geisel. “This quarter’s successful capital raise demonstrates investors’ continued confidence in the company to profitably grow in our marketplace.”
Earlier this year, Sun raised $81.4 million in a stock offering, which helped “strengthen its balance sheet as it accelerated the disposition of problem loans,” according to Peter J. Ostrowski, a former analyst at the Federal Reserve Bank of Boston who is now a managing director at Ostrowski & Co. Inc., a Cranford-based bank consulting firm.
“It’s an excellent strategy since the move will also position Sun for future growth,” he added.
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