Alabama bank halts mortgage lending

AP News
Posted: Nov 12, 2009 11:58 AM

The second-largest thrift in Alabama is suspending mortgage lending amid hefty third-quarter losses as real-estate values moved lower and foreclosure rates turned higher.

Officials with New South Federal Savings Bank, which operates offices in nine states, say the company had a net loss of $41 million for the quarter.

Will Ratliff III, president of the family owned business, says New South is working with regulators and exploring ways to raise new capital.

New South, based in Irondale, has also been reducing expenses and selling assets. The bank said in May it had signed an agreement with the Office of Thrift Supervision that calls for it to boost capital, shrink problem assets and take other steps to improve performance.