Marshall & Ilsley Corp.'s (MI) first-quarter loss widened
despite sharply lower loan-loss provisions as the company reported
higher noninterest and credit-related expenses.
It marks the sixth consecutive quarterly loss for the Wisconsin
regional bank despite an increase in revenue. President and Chief
Executive Mark Furlong said, "Our first quarter results reinforce
our confidence that a credit quality recovery is under way at
M&I."
Many banks, including the Wisconsin lender, began to show some
signs of improved credit quality late last year. Still, Marshall
& Ilsley is expected to continue to struggle this year because
of its exposure to some of the most-troubled U.S. housing markets
and especially large exposure to commercial construction loans.
Marshall & Ilsley last month extended its moratorium, begun in
December 2008, on foreclosures by an additional 90 days through the
end of June.
The company reported a loss of $115.4 million, or 27 cents a
share, compared with a prior-year loss of $92 million, or 44 cents.
Revenue increased 8.7% to $636.7 million.
Analysts polled by Thomson Reuters most recently forecast a loss
of 40 cents on revenue of $575 million.
Loan-loss provisions fell to $458.1 million from $1.33 billion a
year earlier and $639 million in the fourth quarter. Charge-offs,
or loans thought not to be collectible, grew to 3.94% of average
loans and leases from 2.67% a year earlier but fell from 5.01%
sequentially. Nonperforming loans, or those near default, were
4.58% of total loans, compared with 4.21% and 4.62%,
respectively.
Moody's Investors Service in December predicted Marshall &
Ilsley would see "sizable credit losses throughout 2010" because of
its real-estate focus, as the credit agency downgraded its
ratings.
Shares closed Monday at $8.41 and were inactive premarket. The
stock is up 54% this year.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com;