Florida Mortgage Lender Reports Spike in Problem Home Loans

The first-quarter profits of BankAtlantic Bancorp dropped significantly, the South Florida Sun-Sentinel reported Friday, as the bank reported a sharp increase in troubled Florida mortgage loans.

The bank and popular Florida mortgage provider said its earnings fell to 9 cents a share or $5.7 million compared to 10 cents a share or $6.5 million in the three months ended in March.

Due in large part to consumers’ problems with Florida mortgages, the bank took a loss from its continuing operations of $2.2 million - compared to income from operations of $8 million for the first quarter of 2006.

BankAtlantic Bancorp’s Chairman and CEO Alan B. Levan said the mortgage lender saw an increase of more than 79,000 new accounts during the quarter.

• The bank also recorded a $19.6 million increase in troubled Florida home loans for residential real estate development.
• The banking company’s allowance for home loan losses increased to $50.4 million, compared to $41.9 million the year before.

“While we believe Florida remains an attractive market. The Florida real estate market has slowed significantly, and we are facing the challenges associated with this slowdown,” Levan said in a statement.

The company expects further deterioration in its loan portfolio this year, even as mortgage rates remain low throughout the state.

SOURCE: South Florida Sun-Sentinel