Webster Financial (WBS) Reports Preliminary Q4 Results; Cuts Dividend to 1c

January 23, 2009 8:29 AM EST

Webster Financial Corporation (NYSE: WBS) reports preliminary Q4 results, including:

A loss of $300 million or $5.91 per share, largely driven by a $188.9 million non-cash goodwill impairment charge that the Company has determined it will record which has no effect on the Company's liquidity and capital positions, and $129.6 million for non-cash other-than-temporary impairment charges on certain investment securities.

Provision for credit losses of $100 million against $52.8 million of net loan charge-offs; allowance for credit losses increased to 2.02 percent of total loans and 106 percent of nonperforming loans. Past due loans and non performing loans grew at a reduced rate from last quarter end

Planned elimination of approximately 200 additional positions across the Company, resulting in an additional severance charge of $4.2 million

Pre-tax operating loss of $35.9 million or $0.83 per diluted share before OTTI, goodwill impairment, securities gain and losses and severance charges

Strong tangible capital position, including all of the above charges, of 7.70% at year end compared to 5.89% a year ago. Significantly exceed all requirements for well capitalized regulatory ratios

Dividend reduced to $0.01, reflecting desire to preserve strong capital position.

For FY08, net loss totaled $321.8 million, or $6.42 loss per diluted share, compared to net income of $96.8 million, or $1.76 per diluted share in the year-ago period. Pre-tax operating loss in the full year 2008 before OTTI, goodwill impairment, securities gains/losses, and severance charges was $53.7 million or $.80 per diluted share compared to $174.1 million, or $3.17 per diluted share for the 2007 full year.

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