PremierWest Bancorp President Jim Ford neither gloated nor cringed in discussing his bank's third-quarter earnings Wednesday morning.

PremierWest Bancorp President Jim Ford neither gloated nor cringed in discussing his bank's third-quarter earnings Wednesday morning.

PremierWest's $1.3 million net earnings for the three months ending Sept. 30 were modest at best, but compared to many financial institutions that continue to bleed millions of dollars, the Medford-based bank looked fiscally fit.

There were few safe havens for investors Wednesday, however, as the Dow Jones Industrial Average plunged 514 points to 8,519.21. PremierWest stock dropped 26 cents, closing at $7.19.

"Investors think it's important to make a profit, which we have done, as opposed to so many institutions that have had quarter after quarter of losses," Ford said. "But these are times when investors are making decisions based on things that maybe they haven't before."

Wall Street expects, and in most climates, demands ever-higher earnings or dividends. Institutional investors, such as mutual funds and retirement funds, often punish companies whose earnings don't meet their standards. As a result, stock prices take a hit.

That's one advantage PremierWest might have in running bank, finance and investment offices from Portland to Galt, Calif.

"We have a very high count of individual investors, 75 percent, and very little institutional stockholders, 11 percent," Ford said.

PremierWest's remaining stock is held by bank officers and employees.

"Certainly, there are people out there selling, but unless we were to compare one spot in time to another, we wouldn't know who is selling," Ford said. "Frankly, we don't concern ourselves with that, this isn't an institution that focuses on one quarter or another. We're interested in long-term viability."

Third-quarter earnings were down 68 percent from the $4 million PremierWest earned during the same period last year. The banks assets increased 32 percent to $1.5 billion compared to a year earlier.

PremierWest remained well capitalized with a risk-based capital ratio of 11.36 percent. (Analysts consider any figure above 10 percent well-capitalized.) Non-performing assets — overdue loans or loans in default — increased to $61.5 million, or 4.2 percent of total assets, related primarily to loans adversely affected by the real estate downturn.

About $13.9 million of the non-performing loans remain in Northern California. The rest are in Oregon.

The bank's provision for loan losses dropped $475,000 to $4.8 million from the second quarter. That reduced per-share earnings by 14 cents after taxes. PremierWest charged-off $8.6 million in non-performing loans during the quarter, while recovering $364,000 from previously charged-off loans.

The low amount of institutional stock ownership suggests less volatility in stock value, Ford said. Nonetheless, the overall market fluctuations have created plenty of tempests in the markets.

"Throughout the day you can see wild gyrations," Ford said. "But we don't try to run our institution based on day-over-day stock price. We still believe institutions making money, even in these times, will eventually be rewarded."

Reach reporter Greg Stiles at 776-4463 or e-mail business@mailtribune.com.