Shares of Provident Bankshares Corp. slipped in Wednesday afternoon trading after the bank said it would take additional write-downs on its real estate investment portfolio.
Provident Bankshares shares fell 40 cents, or 2.5 percent, to $15.89. Shares have traded between $14.76 and $35.63 during the past year.
The Baltimore bank said it might take an additional write-down on the remaining $32.8 million in the portfolio at the end of the first quarter. It already reduced the value of the portfolio by $47.5 million pretax during the fourth quarter.
Provident Bankshares might also reduce the value on another portfolio worth $14.9 million.
"While the news is disappointing, these developments result in no direct customer impact," Gary Geisel, the company's chairman and chief executive, said in a statement. "The bank's core businesses remain profitable and the bank remains well-capitalized for regulatory purposes."
Ferris, Baker Watts Inc. analyst Matthew Schultheis, cut his 2008 and 2009 earnings estimates for Provident Bankshares. Schultheis cut his 2008 estimate to 41 cents per share from $1.60 per share and his 2009 estimate to $1.60 per share from $2 per share.
Most of Schultheis' earnings cut is tied to the write-downs, but he said the bank will also likely have to reserve more money for future losses on loans, further reducing earnings.
Schultheis maintained a "Neutral" rating on the stock, saying money could be better invested elsewhere.
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