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Published: Friday, 6/20/2003

Genoa S&L looking to end missteps


The thrift, which turns 80 next week, had a large profit heading into the fourth quarter, when it took a charge for potentially bad loans that resulted in a loss of $152,000 for the quarter. By the end of the first quarter this year, its assets had dropped by $8 million from mid-year last year to $118 million. Its commercial loan portfolio slumped by nearly $15 million to $8.7 million.

Still, Genoa Savings had increased deposits to $94 million and made a first-quarter profit of $86,000. It recently reported to the Federal Deposit Insurance Corp. that its equity capital was $9 million and its capital level - one measure of a bank's safety - was well above the regulatory minimum.

The savings and loan said last week it had entered into an agreement with regulators to reduce loans to borrowers with substandard credit and to higher-risk commercial and consumer customers and to raise its capital level even though so far it has kept capital above regulatory requirements.

“We're working with them on all the issues, and we're making a lot of progress,” said Karen Purdue, interim managing officer. She replaced Thomas Everett, who resigned as president and chief executive officer Jan. 17 after 22 years there, including 15 years as the top officer.

The thrift's board is looking for a replacement. “The board is working hard on that,” Ms. Purdue said. “I would expect [an announcement] probably within the next 60 days.”

Ms. Purdue said she couldn't disclose details of the regulatory agreement, and spokesmen for Ohio's Division of Financial Institutions in Columbus and the Office of Thrift Supervision in Washington also declined to provide details.

Genoa Savings, which has branches in Oregon, Maumee, and Perrysburg, had a profit of $793,000 in 1998, on assets of $64 million.

Its assets grew steadily for three years, and profits were $501,000, $505,000, and $675,000, it reported to the FDIC. Last year, its profit was hindered by its fourth-quarter loss, but it still had earnings of $721,000.

The loan portfolio drop in the last six months was “in the normal course of business” and not because of any asset sales, Ms. Purdue said.

One shareholder for the last three years, Barbara Zoltanski, of Perrysburg, said she was concerned about the regulatory sanctions but added that she is confident the thrift will work its way out of its problems.

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