Coral Gables, FL - Jannuary 26, 2010

Mercantil Commercebank, one of the largest banks headquartered in Florida, announced today its 2009 fourth quarter profit of $6.2 million. 

The bank’s total assets increased 2.4% to $6.0 billion, from $5.9 billion the previous quarter.
 Net loans increased 8.4% to $3.2 billion, from $3.0 billion the previous quarter, while deposits increased by 5.3% to $4.4 billion.  Capital also increased by $49.5 million during the quarter to end at $654.5 million.  The Tier 1 capital ratio at December 31, 2009 was 10.5%, more than double the regulatory threshold for a bank to be considered well-capitalized.

During the fourth quarter, the Bank set aside $18.5 million in loan provisions, a substantial decrease from the previous quarter ($47.6 million).  As a result of growing signs of price stability
in the real estate market and the Bank’s proactive management of the troubled loan portfolio, the non-accrual loans to total loans ratio, chiefly real estate-driven, decreased from 14.6% in the previous quarter to 12.7% in the fourth quarter, while the non-performing assets to total assets ratio also decreased from 8.1% to 7.5%. 

“We are seeing encouraging signs in the real estate market, such as an increase in sales, a decrease in unit inventories and a moderation of the price declines experienced in prior quarters.  At the same time, we have dedicated substantial resources to efficiently resolve problem credits while optimizing the recovery potential to the Bank,” commented Millar Wilson, President and CEO.

With net income of $6.2 million, the Bank returned to profitability in the fourth quarter; however, it lost $25.7 million for the year due to the elevated level of loan provisions.  Notwithstanding this, before loan provisions and taxes, the Bank had a profit for the year of $93.1 million, compared to
a profit of $79.3 million last year.  The core results have continued to improve thanks to ongoing efforts to streamline processes and reduce operating expenses, which have been reduced by $8.0 million, or 5.5%, compared to 2008.             

“While 2009 has been a difficult year for us, and banking in general, the positive signs emerging during the last quarter in the economy and the real estate sector, as well as the growth we experienced in lending and deposits have renewed our confidence that the economic recovery is gaining momentum and that we are positioned, with our sound capital base, to emerge from the downturn stronger than ever,” concluded Wilson.

ABOUT MERCANTIL COMMERCEBANK:
Mercantil Commercebank N.A. is one of the largest banks in South Florida serving its community for 30 years. Mercantil Servicios Financieros (MSF), a Venezuelan company, beneficially owns the Bank through U.S. bank holding companies. MSF is the largest provider of financial services in Venezuela with more than 85 years of experience. Mercantil Commercebank has assets of $6.0 billion. The Bank is headquartered in Coral Gables, Florida and has 17 Banking Centers - 15 located in South Florida; one in Manhattan, New York; and one in Houston, Texas. The Bank offers a wide variety of domestic, international, personal and commercial banking services, including investment, trust, and estate planning through its subsidiaries, Mercantil Commercebank Investment Services, Inc. and Mercantil Commercebank Trust Company, N.A.

Editor’s Note: There’s another bank in South Florida whose moniker includes the word ‘Mercantile.’  Please note that we are MERCANTIL COMMERCEBANK. Thank you.

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