PremierWest reports loss

PremierWest Bancorp today reported a $4.1 million loss for the fourth quarter of 2011. The company lost $706,000 in the fourth quarter of 2010.

Loan-loss provisions of $3 million and foreclosure-related expenses contributed $1.4 million against Medford-based PremierWest Bank's bottom line. During 2011, the bank's total nonperforming loans dropped to $76.2 million from $129.6 million in 2010.

Bad loans are slowly disappearing from PremierWest Bank's books, but the bank is still months away from returning to profitability.

"We've made steady improvements for the last five quarters," PremierWest's President and Chief Executive Officer James M. Ford said. "We continue to be working through the problem loans. When the expenses related to problem loans are gone we can become fundamentally profitable."

PremierWest disclosed a Jan. 3 settlement concerning its largest nonperforming loan, totaling $28.7 million. The settlement resulted in a charge-off of $6.2 million, including a partial write-down of a remaining nonperforming loan and a cash settlement in exchange for deeds in lieu of foreclosure and dismissal of lawsuits. The impact on operations was reflected in fourth-quarter results, while PremierWest obtained possession of real property and other collateral on Jan. 11.

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