Alerus Financial in Minneapolis sold three nonperforming loans.
The company said the loans were tied to a construction, land and development relationship with a total net book balance of $33.6 million on March 31. The loans were on nonaccrual and represented the largest nonperforming relationship in the company’s portfolio, representing 62.3% of total nonperforming loans.
As of March 31, the loans carried specific reserves totaling $3.1 million. Nonaccrual interest of $1.6 million was recorded in conjunction with the sale.
“Strong credit outcomes start with strong credit culture,” President and CEO Katie O’Neill Lorenson said in the release. “We emphasize early identification, transparent risk rating, and active portfolio management, so we can address emerging issues quickly and thoughtfully. The sale of this relationship … is a clear example of that discipline in action, and it was completed with no charge-offs and with significant nonaccrual interest recognized in connection with the transaction.”