Lender loses cash in quarter

Community Bank of Nevada lost $37 million in the second quarter, a report filed with regulators shows.

The bank also revised financial results for previous periods and said its nonperforming assets are equal to 28 percent of its assets.

The shortfall follows a first-quarter loss of $48 million, according to the report filed Friday with regulators.

In addition, Community Bank on Monday said that it changed its financial reports to recognize a $37 million increase in allowance for loan losses at Dec. 31 and a $23 million increase in allowance for loan losses on March 31.

The $1.4 billion asset Nevada bank also said it had $878,000 in capital as of June 30 and is no longer adequately capitalized.

It has 14 offices in Southern Nevada.

Community Bancorp, the holding company for the Nevada institution and a smaller bank in Arizona, has contracted with Sandler O'Neill & Partners to help improve its stability, possibly through the sale of the bank or an additional capital investment.

"The directors, management and employees are committed to work through these challenges and move forward," Lawrence Scott, president and chief executive officer, said in a statement. "While the continuing deterioration of the economy remains the primary challenge for the banking industry, we believe firmly in our markets."

The Federal Deposit Insurance Corp. insures up to $250,000 for each interest-bearing depository account and an unlimited amount for noninterest bearing accounts.

Financial results for Southern Nevada community banks generally deteriorated in the second quarter as nonperforming loans and losses grew at many banks.

SouthwestUSA Bank reported that 15 percent of its assets, including loans, were nonperforming on June 30. Sun West Bank showed 10.5 percent of its assets were nonperforming. Nevada Commerce Bank said 5.25 percent of its assets were nonperforming, but that was better than the 9 percent reported at Nevada State Bank, a subsidiary of Zions Bancorporation.

Nevada State, which has $4.3 billion in assets, lost $81.5 million in the second quarter, up from $54.5 million in the first quarter.

SouthwestUSA Bank recorded a $150,000 loss in the second quarter, compared with a $3.6 million loss in the first quarter. Nevada Commerce lost $1.4 million in the second quarter, compared with $565,000 in the first quarter.

For the first half of the year, Community Bank of Nevada reported $27 million in losses on operations before accounting for loan losses.

It held $120 million in foreclosed property, charged off $48 million in bad loans and recorded a $19 million loss on the sale of repossessed real estate.

A Community Bank spokesman declined to elaborate on the statement.

Contact reporter John G. Edwards at jedwards@reviewjournal.com or 702-383-0420.