It’s not new territory to report WestSound Bank’s financial troubles (WSFG’s stock was at $0.40/share Monday and we’ve reported on the company’s problems here), but the Times’ analysis of state banks ranks WestSound as the most troubled. Not exactly what Bremerton courts statewide coverage over, though investors should be pleased when public companies are scrutinized.
Among the paper’s revelations: The bank’s “comprehensive risk ratio,” which indicates weakness based on nonperforming and noncurrent assets like foreclosed real estate, is the highest of 52 Washington banks in the study, at 282 percent. The two other Kitsap banks included, Kitsap Bank and American Marine, had ratios of 30.9 and 65.6, for comparison.
Putting the struggles of community banks in this context helps shed light on the industry here, since we have a number of them in town, and the data used is interesting to go through. Anyone following Westsound’s story knows it’s not just the Citis and WaMus that made dumb bets and loaned far more than was responsible, and problems exists for some of the little guys as well. Westsound has acknowledged mistakes and will not fall under SEC sanctions, and last June new CEO Terry Peterson announced a three-year plan to stability. If the Times’ data is any indication, it’ll be an uphill road.
— David Nelson