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Sky Financial Group Lowers Earnings Estimate
BOWLING GREEN, Ohio -- Sky Financial Group Inc. expects earnings for the first quarter to be in the range of 29 cents to 30 cents per diluted share -- down from the prior guidance of 44 cents to 45 cents per diluted share, officials announced Friday.In the first quarter, Sky expects to record a provision for credit losses of $29 million to $31 million.The increased provision for credit losses is a result of higher than anticipated credit losses, primarily from two large commercial credits and the sale of a group of non-performing consumer loans, officials said. The commercial credit losses are attributable to a leasing company, which had a concentration of commercial leases to a service provider that declared bankruptcy, and from the closure of a cold storage food business, which lost its primary customer and the pending sale of the business did not occur as expected. The non-performing consumer loans are primarily second mortgages, which Sky expects to sell by the end of the first quarter.Including the expected sale of the non-performing consumer loans, Sky expects to report non-performing loans at the end of the first quarter 2005 of approximately $123.8 million compared to $143.7 million at the end of last quarter. The allowance for credit losses is projected to be approximately $149.6 million or 121% of non-performing loans at the end of the first quarter, compared to $151.4 million or 105% of non-performing loans at the end of last quarter. "We are confident that our credit underwriting remains solid and that the higher credit losses this quarter do not represent any systemic concern," said Marty E. Adams, president, chairman and chief executive officer. "Looking ahead, we project future credit losses to be consistent with our prior record."Sky Financial Group will report first quarter earnings on April 20. Sky Financial Group is a $14.9 billion diversified financial holding company that operates over 280 financial centers serving communities in Ohio, Pennsylvania, Michigan, Indiana and West Virginia. Financial service affiliates include Sky Bank, Sky Trust and Sky Insurance.Visit Sky Financial Group: www.skyfi.com "