Second National Federal Savings Bank, a struggling thrift based in Annapolis and Salisbury, said yesterday that it lost $5.5 million, or 80 cents a share, during last year's fourth quarter after making a large provision to its reserves for souring loans.
The company, which has seen its portfolio of loans badly deteriorate in the past year, said that it added $10.5 million during the last three months of 1990 to its pool of funds used to cover the costs of bad loans. That compared with a similar addition of $555,000 for the same period a year earlier, when the S&L earned $2.4 million, or 32 cents a share.
Hit by the slumping real estate market and millions of dollars in bad loans, Second National has struggled in the last few months to maintain a level of capital acceptable to federal regulators.
The thrift, with 37 branches in four states and Washington, added $36.8 million to its loan-loss reserves last year, more than 20 times the $1.6 million it added in 1989.
Second National said in January that, after accounting for an expected fourth-quarter provision for troubled loans, it had fallen below two of the three capital levels required by regulators.
In yesterday's announcement, the thrift said it was $9.9 million below core capital requirements and $15.8 million under capital levels tied to the riskiness of its portfolio. It exceeded tangible capital requirements by $14.6 million.
As a result of the shortfall, Second National filed a capital plan earlier this year aimed at bringing the thrift into regulatory compliance by 1994.
That plan was approved a week ago by the Office of Thrift Supervision, the federal agency that regulates the nation's savings and loan industry.
According to Second National, the plan included continuing the suspension of dividends, decreasing the amount of total assets, cutting general and administrative expenses and reducing the amount of troubled loans and real estate owned by the company.