Associated Banc-Corp. Releases Updated Credit Quality Guidance for 2Q

Associated Banc-Corp announced updated credit quality guidance for the second quarter of 2009.

The company said it expects to record a provision for loan losses between $145.0 million and $160.0 million for the second quarter of 2009, which may result in a loss in the second quarter. Second quarter 2009 net charge-offs are expected to be between $60.0 million and $70.0 million. After taking into consideration this increased provision, capital levels will exceed all well capitalized standards at June 30, according to officials.

"This higher than anticipated provision results from asset quality downgrades to existing construction, commercial real estate and C&I credits, which are a result of weakness in the economy and further deterioration in collateral values," said Associated Chairman and Chief Executive Officer Paul S. Beideman. "We believe loan loss provisions and charge-offs will remain elevated due to the continued deterioration in the real estate sector and the weak economy. We expect the pace of loan and asset deterioration to moderate in future quarters."

Associated also announced that the Board of Directors has formed a new Risk and Credit Committee to supplement the company's and Audit Committee's ongoing oversight of risk management in the areas of credit risk and investment portfolio risk. The Board has appointed the following directors to the Risk and Credit Committee: John C. Seramur (Chairman), Eileen A. Kamerick and Richard T. Lommen.

As previously announced, Associated Banc-Corp will release second quarter results on Thursday, July 16.

Associated Banc-Corp is a diversified bank holding company.

((Comments on this story may be sent to newsdesk@closeupmedia.com))

Related terms: bank, ceo, commercial, construction, economy, investment, real estate, standards