Medford-based People's Bank of Commerce reported a second-quarter loss of $534,000 today, attributing it to aggressive cleanup of the effects of devalued real estate on its books.

Medford-based People's Bank of Commerce reported a second-quarter loss of $534,000 today, attributing it to aggressive cleanup of the effects of devalued real estate on its books.

The bank reported second quarter pre-tax operating income of $117,000 compared to $72,000 for the same quarter in 2008, and its loan loss reserves ballooned to $994,000 compared to $96,000 in the same period last year. Such reserves count against earnings, even though the funds may be recovered in the months ahead.

The bank's assets grew 12 percent during the quarter to $96.9 million compared with $86.5 million at the end of the first quarter and $84.6 million at the end of the second quarter of 2008.

Portfolio loans as of June 30, 2009, totaled $74 million compared to $72 million at the end of the first quarter and $68 million at the end of the second quarter in 2008.

Modest earnings during the first quarter helped to reduce the year-to-date loss to $474,000, or 52 cents per share, for the first six months of 2009 compared to a profit of $79,000, or 9 cents per share, in 2008.

The bank also declared its 14th quarterly cash dividend of 5 cents per share to be paid on Sept. 1 to shareholders of record Aug. 15.

— Greg Stiles