The bad news for Seacoast seems to just run on to the point where you get desensitized to it. I had to refresh my memory by looking back over the last few quarterly Call reports to help me put things in perspective. Here are a few data points of interest:

Net charge offs by quarter from Q3/2008 to Q3/2009 were $9.3MM, $33.9MM, $8.5MM, $15.1MM and $48.7MM, for a 5 quarter total of $115.5 million or about the same as the recent capital raise plus the TARP preferred. Nice burn rate.

Loans added to non accrual status by quarter from Q2/08 to Q3/09 were $29.7MM, $42.8MM, $52.2MM, $37.2MM, $46.3MM and $75.3MM. Over those 6 fiscal quarters, a total of $283.5 million of Seacoast's loans were placed on non accrual, which represents almost 20% of their total loan portfolio at 9/30/09.

Total Real Estate Owned - meaning foreclosed property, has gone from around $5 million at the end of 2008 to nearly $27 million at 9/30/09, quite a move in 3 quarters.

Non performing assets (Real Estate Owned and Loans on Non accrual) have grown from $92 million at the end of 2008 to almost $181 million at 9/30/09, doubling in 3 quarters. That translates into about 8.5% of total assets as non performing assets at 9/30.

In 2008 the bank lost $43.5 million, and in the first 3 quarters of 2009 they've lost nearly $107.6 million, but I think about half of that 09 loss was goodwill impairment, so in real dollars they've only lost about $50 million so far in 2009. In other words, somewhere north of $100 million in real money has gone poof in 7 fiscal quarters. I'm not sure that the $50 million TARP preferred and the recent common equity raise will go all that far with those kind of results.

I guess I'm just a simpleton when it comes to financial analysis, because I can't figure out for the life of me what those brilliant institutional investors and their teams of analysts see in this company. Every common metric of performance I can come up with looks pretty ugly.

It must be the assurances from management that all is well such as this passage from Denny Hudson in a press release issued July 24, 2008:

"Our core earnings (before credit costs) remained stable despite very challenging market conditions. These results reflect our relationship-based growth strategy that has for many years produced what has become one of the most valuable core deposit franchises in the state of Florida. This strategy continues to serve us well in the current environment, as it has allowed us to avoid the impacts of costly wholesale funding and maintain a strong liquidity position," said Mr. Hudson. "The fundamentals of our business model remain very much in place and should continue to produce solid underlying earnings support as we proceed through the current credit cycle. We will continue to evaluate our cost structure in light of market conditions in order to maintain stable core earnings".

Note the statement that this great retail franchise has allowed Seacoast to "avoid the impacts of costly wholesale funding". So I guess brokered deposits are a bad thing, and sure enough, at 6/30/08 Seacoast has zero brokered deposits. However, at 12/31/08 they had just over $100 million in brokered CDs, so now I guess brokered deposits are OK. So what happened to that great retail deposit franchise?

Then there is the statement "The fundamentals of our business model remain very much in place and should continue to produce solid underlying earnings support as we proceed through the current credit cycle".

In the 5 fiscal quarters since Denny published those words, I calculate that Seacoast has reported a GAAP loss of around $137 million!!!! He obviously has a different definition of "solid underlying earnings" than I do. Sure wish I'd dumped my stock in this turkey about 2 years ago. Oh well, live and learn.