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White River Capital posts $20.5M loss

November 7, 2008

White River Capital Inc. today reported a $20.5 million loss in the third quarter, in line with expectations the company announced Oct. 27.

The loss reflected a previously disclosed non-cash write-off of $34.5 million of goodwill to reflect the declining values of financial services stocks.

The Indianapolis company owns Virginia Beach-based Coastal Credit LLC, which acquires sub-prime loans from car dealers, and locally based Union Acceptance Credit Corp, which oversees a smaller portfolio of non-prime auto receivables.

"The write-off of all goodwill during the third quarter had no effect on our cash balances, liquidity or borrowing capacity," said Martin Szumski, chief financial officer.

Excluding the write-off, operating income was flat - $1.5 million vs. $1.5 million in the third quarter of 2007.

"White River had another stable operating quarter during continued difficult economic conditions," CEO Mark Ruh said.

Coastal Credit loans delinquent 30 days or longer rose to 4.4 percent as of Sept. 30 vs. 4 percent on June 30.

Provision for estimated credit losses was $2.3 million in the third quarter compared with $1.9 million in the prior quarter.

Total allowance for loan losses rose to 7.23 percent from 7.02 percent in the second quarter.

Coastal credit has $100 million in finance receivables and Union Acceptance, has $2.3 million.

On Oct. 27, White River said it will buy back as many as 150,000 shares, or about 3.9 percent of its outstanding common stock.

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