Eagle Bancorp in Bethesda, Md., reported a sharp drop in profit after its loan-loss provision spiked.
The $11.3 billion-asset company said in a press release that first-quarter net income fell by 89% from a quarter earlier, to $1.7 million, largely due to a $14.1 million increase in provision expense.
Eagle said that the provision reflected a need to replenish the loan-loss allowance after the company had $11.2 million in net chargeoffs during the quarter, along with updated assumptions tied to the probability of default and losses in its CRE portfolio.
The chargeoffs included $5 million for an assisted-living facility; $2 million for an office building in Washington, D.C.; and $4 million for an office building in Arlington, Va.