Coast Financial Holdings, Inc. Provides Additional Information Regarding Construction-to-Permanent Residential Loan Portfolio
January 26 2007 - 2:45PM
PR Newswire (US)
BRADENTON, Fla., Jan. 26 /PRNewswire-FirstCall/ -- Officials of
Coast Financial Holdings, Inc. (NASDAQ:CFHI), parent company of
Coast Bank of Florida, today provided detailed information
regarding the Bank's construction-to-permanent residential loan
portfolio, which has been discussed in the Form 8-K filed with the
Securities and Exchange Commission on January 19, 2007 and the
press release dated January 22, 2007. "We think this information
will be useful to our shareholders and customers," said Brian
Grimes, President and CEO. "Although we are still reviewing these
loans in order to finalize our estimate of any resultant financial
impact, we are confident that we can work through these problems
and remain a strong institution." Grimes said, "A careful analysis
of the portfolio of 482 loans under review shows that 154 loans
were made on homes which are now more than 90% complete, 112 loans
are on homes which are between 10% to 90% complete and the
remaining 216 loans are on lots where there has been no
construction activity. All of the loans are secured by property
located in Charlotte, Sarasota and Pinellas counties. "For those
loans that are secured by lots with no construction activity, the
Bank has received inquiries from many customers about converting
their current loan to a term loan with 3 to 5 year maturities. This
would allow the borrower to secure ownership of the property
without the need to commence any construction activities. The Bank
expects that most, if not all, of these loans will not proceed with
any construction activity under the terms of the current
construction loan agreements," Grimes said. "This would have the
effect of reducing Coast Bank's total contractual loan commitments
from approximately $110 million to approximately $ 77 million and
the amounts to be disbursed in the future from approximately $44
million to approximately $11 million." "For those loans that are on
homes which are more than 90% complete, in most cases, there are
funds available in the associated loans-in-process account to pay
for remaining items such as impact fees, landscaping, etc. For
these loans, the Bank has informed those customers who have
inquired that it would be willing to finance the shortfall that may
exist between the remaining funds and the total required in order
to secure a certificate of occupancy. "For the 112 loans that are
on homes that are 10%-to-90% complete, the Bank will be contacting
the borrowers to determine how they would like to proceed under the
terms of the applicable agreements," Grimes said. James Toomey,
Chairman of the Board of Coast Bank, said, "We would like to
reiterate to our shareholders and customers that we are focusing
all of our efforts on resolving this situation. We were encouraged
to learn that the majority of the loans in question were on
properties that were either very close to completion or that have
had no construction activity. We feel that in both these scenarios,
a resolution which will be acceptable to both the loan customer and
Coast Bank is readily attainable." About the Company Coast
Financial Holdings, Inc. through its banking subsidiary, Coast Bank
of Florida (http://www.coastfl.com/), operates 20 full-service
banking locations in Manatee, Pinellas, Hillsborough and Pasco
counties, Florida. Coast Bank of Florida is a commercial bank that
provides full-service banking operations to its customers from its
headquarters location and from branch offices in Bradenton,
Palmetto, Longboat Key, Seminole, Dunedin, Clearwater, Kenneth
City, Brandon, St. Petersburg, Lutz, Largo and Pinellas Park. This
press release and other statements to be made by the Company
contain certain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act, including but not
limited to statements relating to projections and estimates of
earnings, revenues, cost-savings, expenses, or other financial
items; statements of management's plans, strategies, and objectives
for future operations, and management's expectations as to future
performance and operations and the time by which objectives will be
achieved; statements concerning proposed new products and services;
and statements regarding future economic, industry, or market
conditions or performance. Forward-looking statements are typically
identified by words or phrases such as "believe," "expect,"
"anticipate," "project," and conditional verbs such as "may,"
"could," and "would," and other similar expressions or verbs. Such
forward-looking statements reflect management's current
expectations, beliefs, estimates, and projections regarding the
Company, its industry and future events, and are based upon certain
assumptions made by management. These forward-looking statements
are not guarantees of future performance and necessarily are
subject to risks, uncertainties, and other factors (many of which
are outside the control of the Company) that could cause actual
results to differ materially from those anticipated. These risks,
uncertainties, and other factors include, among others: changes in
general economic or business conditions, either nationally or in
the State of Florida, changes in the interest rate environment, the
Company's ability to successfully open and operate new branches and
collect on delinquent loans, changes in the regulatory environment,
and other risks described in the Company's Form 10-K for the fiscal
year ended December 31, 2005, the Company's Form 10-Q for the
quarter ended September 30, 2006, and as described from time to
time by the Company in other reports filed by it with the
Securities and Exchange Commission. Any forward-looking statement
speaks only to the date on which the statement is made, and the
Company disclaims any obligation to update any forward-looking
statement, whether as a result of new information, future events or
otherwise. If the Company does update any forward-looking
statements, no inference should be drawn that the Company will make
additional updates with respect to that statement or any other
forward- looking statements. DATASOURCE: Coast Financial Holdings,
Inc. CONTACT: Brian F. Grimes, President and CEO, +1-941-345-1476,
or , for Coast Financial Holdings, Inc. Web site:
http://www.coastfl.com/
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