Synovus sees bright spot in latest loss

It’s a sign of how rough things have been for Synovus that the bank on Tuesday reported a $215.7 million first-quarter loss and deemed it a sign of better times ahead.

Synovus, Georgia’s second-biggest bank, has been hammered by bad real estate loans over the past two years, losing more than $2 billion over that stretch. But the level of red ink has steadily dropped since peaking in the second quarter of last year at $587 million.

“We continue to see … improvements in the trends that are driving us down this journey toward a return to profitability,” said Richard Anthony, president and CEO of the Columbus-based bank, during a conference call with investors and analysts.

The loss of 47 cents per share narrowly beat analysts’ estimates, but Wall Street did not react favorably. In after-hours trading the company’s stock price dove about 9 percent, to $3.45 a share.

Anthony insisted the company is turning the corner and could post a profit by the end of the year.

“We fully expect 2010 to reflect a significant improvement over last year,” he said. “I believe we’re off to a good start in that regard.”

Positive signs Anthony cited include a reduction in the amount of bad loans being charged off and a drop in the level of loans being classified as non-performing.

Synovus charged off $316 million in loans in the first quarter of the year, compared to $362 million in the fourth quarter of 2009 and $497 million in the third quarter of 2009.

Synovus received nearly $1 billion from the federal government’s TARP program in 2008 and has yet to make any repayments. Last year it sold $600 million in new shares of the company’s stock.

The company formed as a collection of largely independent community banks, but earlier this year it announced a plan to consolidate its 30 banking charters into a single charter later this year. In metro Atlanta, Synovus operates Bank of North Georgia and Bank of Coweta County, and those brand names will remain.