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Central KY Real Estate Sales Up

From LBAR.com:  April real estate statistics for the Bluegrass contain many positive indicators. Pending inventory increased a dramatic 41.2% over April 2009, rising from 809 to 1143 pending sales. Sales saw a sharp rise in April, increasing 20% for the year-to-date over 2009 and 36% over April 2009. Existing Home Sales increased 39% over April 2009 from 473 to 659. New construction sales rose 14% during the same time period.

LBAR President Anthony de Movellan stated, “We are seeing the highest numbers for pending sales since 2005, indicating heavy implementation of the $8,000 federal tax credit program. We look forward to seeing the figures for upcoming months that reflect these record breaking numbers.”

Integra Bank 1Q

Click here for more about Integra Bank’s first quarter:  “The net loss for the first quarter of 2010 was $53.9 million or $2.61 per diluted share compared to $96.1 million or $4.64 per diluted share for the fourth quarter of 2009. This loss was driven primarily by provision for loan losses which was $52.7 million, an increase of $22.2 million from the $30.5 million in the fourth quarter of 2009. The fourth quarter 2009 results included a non-cash charge of 75.6 million which resulted from our decision to fully reserve our deferred tax assets.

During the first quarter we made adjustments to our problem asset disposition strategy and are now focused on quicker disposition of our non-performing assets as opportunities arise.”

Foreclosure Rate Surges in First Quarter

The crisis is NOT over.  As the Courier-Journal is reporting:  “The number of homeowners who missed at least one mortgage payment surged to a record in the first quarter of the year, a sign that the foreclosure crisis is far from over.

More than 10 percent of homeowners had missed at least one mortgage payment in the January-March period, the Mortgage Bankers Association said Wednesday. That number was up from 9.5 percent in the fourth quarter of last year and 9.1 percent a year earlier. . . .

Without adjusting for seasonal factors, the national delinquency numbers dropped, as they normally do from the winter to spring.

In Kentucky, the percentage of past-due residential loans was 8.31 percent, down from 9.76 percent in the final three months of 2009 but up from 7.39 percent a year ago.

Kentucky’s rate, which was not adjusted for seasonal changes, was lower than the national rate of 9.38 percent. The state ranked 26th among all states and the District of Columbia for delinquent loans. Nevada, where more than 14 percent of loans were past due, ranked first.

Are Anti-Foreclosure Programs Working?

Home-ownership is a good thing.  The more people able to live the American Dream, the better.  Communities are more stable, neighborhoods are better, and crime is lower.

But, how is the anti-foreclosure program working?  Well, first off, something had to be done and this seemed the most logical step.  But the program was rolled out so fast that companies are having a hard time adjusting to it, or they simply do not wish to be bogged down.  There’s the rub . . . is it the government or is it the company with the problem?

From Cincinnati.com, read more:  “The number of homeowners dropping out of the Obama administration’s main mortgage assistance plan is growing, and is now almost equal to the number who have received permanent relief.

The Treasury Department’s report on Monday was the latest evidence of problems in the administration’s $75 billion program. While officials insist the program is helping the housing market turn around, critics say it is merely delaying an inevitable surge in foreclosures.

More than 299,000 homeowners had received permanent loan modifications as of last month, Treasury said. That’s about 25 percent of the 1.2 million who started the program since its March 2009 launch. They are paying, on average, $516 less each month.

However, the number of people who started the process but failed to get their mortgages permanently modified rose dramatically in April.

To complete the program, borrowers must make at least three payments on time. About 277,000 homeowners, or 23 percent of those enrolled, have dropped out during this trial phase. That’s up from about 155,000 a month earlier, or a 79 percent increase.”

Late Mortgages Dip A Little

Cincinnati.com had this report:

The number of Ohio and Kentucky homeowners behind on their mortgage payments dropped dramatically in the first three months of 2010, according to new industry data.

Both states saw 17 percent drops in the numbers of households at least one month behind on loan payments – making them the No. 7 and No. 9 states respectively with the biggest drops. The nation saw an 11.5 percent drop in mortgage delinquencies, according to report issued Tuesday by the Mortgage Bankers Association.

The trade group cautioned, however, the figures are not seasonally adjusted and don’t exclude normal seasonal improvements in payment performance. For example, heating bills and holiday expenses tend to push up mortgage delinquencies near the end of the year. Many of those borrowers become current on their loans again by spring.

When adjusted for seasonal factors, the number of homeowners who missed at least one payment on their mortgage surged to a record in the first quarter of 2010 – a sign that the foreclosure crisis is far from over.

More than 10 percent of homeowners nationwide missed at least one mortgage payment in the January-March period. That number was up from 9.5 percent in the fourth quarter of last year and 9.1 percent a year earlier.

Foreclosures Still a Drag on the Economy

Foreclosures are still having a significant effect on the economy as a whole, even though the economy may be growing and more people are feeling better about it, the housing crisis still looms large in what’s going on.  As Kentucky.com is reporting:

The mortgage crisis is dragging on the economic recovery as more homeowners fall behind on their payments.

Analysts expect improvement soon, but the number of homeowners in default or at risk of foreclosure will have a lingering effect on the broader economy.

More than 10 percent of homeowners with a mortgage had missed at least one payment in the January-March period, the Mortgage Bankers Association said Wednesday. That’s a record high and up from 9.1 percent a year ago.

Farmers Bank 1Q

Farmers Bank based in Frankfort had this to report: “The improvement in net income in the linked quarter comparison is mainly attributed to the goodwill impairment charge and overall higher expenses associated with nonperforming assets during the fourth quarter of 2009 (primarily the provision for loan losses) coupled with an increase in net interest income in the current quarter. Nonperforming assets were as follows for the periods indicated.

The increase in nonperforming assets was driven mainly by higher restructured loans of $24.4 million. The increase in restructured loans was boosted by a single residential real estate development credit in the amount of $10.7 million. Substantially all of the increase in restructured loans is secured by real estate. The Company is working diligently to identify which of its other challenged credits may merit a restructuring of terms in order to maximize loan repayments. Cash flow projections are carefully scrutinized prior to restructuring any credits; past due credits are typically not granted concessions.

The Company added $1.9 million to its provision for loan losses in the first quarter of 2010, a decrease of $4.6 million compared to $6.5 million for the fourth quarter of 2009. Net loan charge-offs were $1.6 million and $5.2 million in the current three months and linked quarter, respectively, a decrease of $3.6 million or 69.0%. Net charge-offs as a percentage of outstanding loans (net of unearned income) were .13% and .41% in the current and linked quarters, respectively.

Read the rest of the report.

Kentucky First Federal 1Q

More information about the first quarter banks are seeing.  This is from Kentucky First Federal based in Hazard and Frankfort.

“The decrease in net earnings for the quarter ended March 31, 2010 was primarily attributable to higher levels of non-interest expense, as well as additional provision expense for loan loses.  Non-interest expense increased $98,000 or 8.4% to $1.3 million for the recent quarter ended due primarily to higher FDIC insurance premiums, higher levels of employee compensation and benefits and higher legal fees.  As is the case for most FDIC-insured financial institution, the two banks owned by the Company are experiencing higher FDIC insurance premiums mandated to increase deposit insurance fund levels as a result of the recent increase in bank failures. The increase in compensation costs was due in large part to higher levels of retirement expense in the recently ended quarter than in the linked quarter.”

Read more.

Integra Bank 1Q

Some more numbers starting to come out from banks across Kentucky.

“Our first quarter results reflect continued weakness in commercial real estate, which was reflected in our large provision and net charge-offs as well as a change in our non-performing asset disposition strategy that will result in quicker disposition of those assets as opportunities arise. We will take advantage of opportunities to sell, exchange for other assets or accept discounted payoffs where appropriate, particularly in situations where we believe it would take several quarters for values to recover. Our efforts continue to be focused around reducing our level of non-performing assets, improving our capital and liquidity and increasing the operating income of our core community banking franchise,” stated Mike Alley, Chairman and CEO. “Since we announced our results for 2009 approximately two months ago, we have announced two branch and loan sales in addition to the three pending multi-branch/loan transactions we announced earlier. These pending branch sale transactions are a key component of our plan to increase regulatory capital,” Alley added.

The net loss for the first quarter of 2010 stems mainly from the provision for credit losses. The net loss for the fourth quarter of 2009 included an increase in the tax valuation allowance of $75.6 million, a $5.3 million deposit premium and a $1.5 million write-down of the two banking facilities that were retained in a branch sale. Non-performing assets increased $11.6 million during the first quarter of 2010 to $258.5 million at March 31, 2010.

More Information.

Economy Recovering, But Still Long Way to Go

From the AP Wire:  Economic stress declined in March in nearly three-quarters of the nation’s 3,141 counties, according to The Associated Press’ monthly analysis of conditions around the country.

The gains were due to an improving job market in the Mid-Atlantic and Southeast and a steadying of foreclosure rates across the Sun Belt.

In 38 of the 50 states, economic distress dipped or was unchanged from February, AP’s Economic Stress Index found. Nationwide, foreclosures worsened slightly. Bankruptcy rates did, too. But those declines were offset by a better jobs picture.

The March improvement, though, belies the depth of the recession and how far the recovery still must climb, said Frank Hefner, an economist at the University of Charleston in South Carolina.