Cornerstone Bancshares Inc. more than doubled its third-quarter profits from a year ago, continuing the bank's recovery from hefty loan losses over the previous three years.
The Chattanooga bank holding company said Wednesday it earned $524,000, or 6 cents per share, in the three months that ended Sept. 30. In the same period a year ago, Cornerstone earned $214,000, or 3 cents per share.
The earnings gain was the third consecutive quarter of profitability for Cornerstone and came largely from a drop in loan write-offs from $1.4 million in the third quarter of 2010 to only $265,000 this quarter.
"At every level and in every department, our Cornerstone team has really pulled together and put forth the effort to help us regain our solid earnings footprint and return to greater profitability," said Cornerstone's President Frank Hughes.
Hughes said the improved profits "place the bank in a positive position to move forward as the capital campaign progresses."
Cornerstone, which launched a $15 million preferred stock offering last year to help shore up the bank's capital position after losses in the previous two years, has raised more than $7.5 million through its preferred stock offering.
The offering features a new security with a 10 percent cumulative annual dividend, and is convertible into common stock after five years and a 50 percent increase in common stock value over the preferred stock's strike price.
With five branches in Hamilton County and a loan production office in Dalton, Ga., Cornerstone has assets of $426 million.