Silver State Bank Reports Second Quarter loss, CEO & Chairman Resign

Silver State Bank Reports Second Quarter loss, CEO & Chairman Resign

Henderson-based Silver State Bank announced on August 1st that it had loss $62.7 million for the second quarter. Silver State's CEO Corey Johnson, 50, resigned and Bryan Norby, 51, Chairman of the Board also resigned.

Silver State's loss for the first six months of 2008 was reported to be $77.1 million. Silver State's loss increased in 2nd quarter 2008 due to an increase in the provision for loan loss reserves of $58.6 million. The provision for loan losses at June 30, 2008 stands at $68 million. The bank's non-performing loans are reported to be $252 million. Banks generally set up a reserve based on the expected amount of loss on a loan after selling the collateral that was used to secure the loan. Silver State Bank attributed the loss to "the increase in nonperforming loans is primarily related to the bank's residential construction and residential land portfolio which continues to experience deterioration in estimated collateral values and repayment abilities of some of the bank's customers." The bank notes in its press release that it does not, nor has it ever, engaged in subprime lending.

At June 30, 2008 the bank had deposits of $1.73 billion of which $1.17 billion were time deposits. .

Silver State's Board named Phillip Peckman, 59, as the acting Chairman. Peckman has been a Director of Silver State Bank since May 1997. From 1990 until 2006, Peckman held senior executive positions, including CEO, at the Greenspun Corporation Peckman is the currently the Chairman of the Nevada Development Authority and owner of Peckman Outdoor Media.

Silver State also named Michael J. Thorell, 42, as the acting CEO. Mr. Thorell had been recently appointed as Chief Lending Officer and Chief Credit Administration Officer of Silver State Bank. Prior to that, Mr. Thorell was President of Choice Bank, Silver State's Arizona chartered bank subsidiary.

John Laub is the President of the CEO-CFO Group.

1. "Bank Reports $62.7 Million Loss, Replaces Key Officials." John Edwards. The Las Vegas Review Jounal. August 2, 2008.

2. "Second-Quarter Losses Lead Silver State Bancorp to Question Expansion Plans." Chris Casacchia. The Phoenix Business Journal. August 1, 2008.

3. "Silver State Bancorp Announces Management Reorganization." Company Press Release. Business Wire. August 1, 2008.

4. "Silver State Bancorp Reports 2008 Second Quarter Financial Results." Company Press Release. Business Wire. August 1, 2008.