Recently, there has been media attention about Charter Oak Bank and our second-quarter financial results. I want to take this opportunity to provide you with information about our results and our strategy for the bank’s future.
In the second quarter, the management and Board of Directors of Charter Oak Bank decided to significantly increase our reserves for potential loan problems. While these loans may ultimately perform, given the economic struggles facing our community and those that we serve, we believed this was the prudent thing to do.
The consequence of this decision is a second quarter loss of $5.8 million. Even so, we believe that the ongoing operations of the bank are fundamentally sound. In fact, in the first eight months of the year, we had an operating profit before reserves of more than $1 million. August 31st assets were $145 million, with deposits at $124 million. Our deposit accounts are FDIC insured up to $250,000, with 100% coverage on non-interest bearing checking accounts.
We have agreed with regulators that it would be best for Charter Oak Bank to raise additional capital to strengthen the bank’s balance sheet and to implement a strategy for growth. We are in the process of raising that capital.
We appreciate the opportunity to serve you and provide the personal service unique to community banking. Charter Oak was founded to support the local community, helping businesses and families access the financing they need to grow their businesses and achieve their dreams. We remain committed to that mission.
If you have any questions, please do not hesitate to contact me at 707-265-2001 or bkelly@charteroakbank.com.
Brian Kelly
President & CEO
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