Atlanta-based Fidelity Southern Corp. reported a $2.8 million second-quarter loss on Friday, its fifth consecutive quarter in the red.
But the company, which operates Fidelity Bank, one the largest community banks in the state, said the Atlanta real estate market is “very near” stabilization.
“Based on the improving credit quality of our consumer lending portfolio, we believe the worst of the recession is behind us,” the bank’s chairman, James B. Miller, said in a news release.
Fidelity, which has 23 branches in Atlanta and one in Jacksonville, Fla., has been hit hard by the collapse of the real estate market and the ensuing recession.
The bank reported $80 million of nonperforming residential construction and development loans at the end of the second quarter, including 179 houses and 613 lots.
The bank’s parent company reported losses of $6.1 million so far this year, compared to earnings of $208,000 during the same six-month period last year.
Bright spots include the bank’s ramped-up mortgage business, which has proved profitable. Fidelity, which hired a team of mortgage brokers earlier this year, earned $4.7 million from its mortgage business in the second quarter, compared to $125,000 a year ago.
The bank also has seen a rise in sales of its foreclosed homes, said Palmer Proctor, Fidelity’s president. But Proctor isn’t ready to say things have turned around.
“We are starting to see some encouraging signs out there in the marketplace,” Proctor said in an interview. “It’s too early to call it a trend, though.”
Georgia’s largest banks, including SunTrust and Synovus, report earnings next week.
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