Park National in Newark, Ohio, sold securities at a loss.
The $10 billion-asset company disclosed in a regulatory filing that it sold $291 million in available-for-sale debt securities at a $7.9 million pretax loss.
Specifically, Park sold $207 million of fixed-rate debt securities at a $6.6 million net loss, using proceeds primarily to reduce borrowings. It should take less than two years to earn back the loss.
Separately, the company sold $84 million of variable-rate debt securities at a $1.3 million net loss. The plan is to use those proceeds to fund loan growth and reduce risk exposure to a declining interest rate environment. It should take a little over a year to earn back that loss.
Park said the repositioning should add $3.8 million to 2024 net income, while the net interest margin is expected to improve by 15 basis points.
Finally, the transactions should allow Park to dip below $10 billion of assets on Dec. 31.