Horizon Financial (HRZB) Declares Dividend; Sees Significant Increase in Non-Performing Loans

June 26, 2008 4:07 PM EDT

Horizon Financial Corp. (Nasdaq: HRZB) has declared a quarterly cash dividend of $0.135 per share. The dividend will be paid on August 1, 2008, to shareholders of record as of close of business July 11, 2008. Horizon also reported that it anticipates significant increases in its non-performing loans and net charge-offs for the fiscal first quarter of 2009, ended June 30, 2008.

"With our current capital position, we are able to maintain our cash dividend payment this quarter despite higher levels of non-performing loans and net charge-offs," said Rich Jacobson, Chief Executive Officer. "While we have not completed the quarter-end portfolio review, we expect non-performing assets to increase to approximately $39 million at June 30, 2008 and charge-offs for the quarter of approximately $3.0 million. Construction and land development loans in Pierce and Snohomish counties are the primary source of these problem loans, and we are working closely with our customers to resolve these issues as quickly as possible. Consequently, our provision for loan losses is expected to remain at elevated levels for at least the next few quarters."

Horizon also announced that it has reactivated its search for a new Chief Financial Officer, following the promotion of Rich Jacobson to Chief Executive Officer earlier this year. [SM]

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