Question-and-Answer Session
Operator
Thank you. (Operator Instructions) Our first question does come from Christopher Marinac from Fig Partners. Please go ahead.
Christopher Marinac – Fig Partners, LLC
Thanks, good morning, Bill and Jack.
William J. Small
Good morning, Chris.
John C. Wahl
Good morning.
Christopher Marinac – Fig Partners, LLC
I want to ask about the credit quality at Pavilion and what you know about how their year finished up and was there any deterioration from where they already were at last quarter.
William J. Small
We have seen some deterioration there, Chris. We have been monitoring that very, very closely actually trying to make sure that they have everything in place to address those issues. We don’t have, I cannot release any direct numbers or anything on theirs, but we have seen some deterioration. That, obviously the state of Michigan, Southeast Michigan, certainly has felt a major part of the impact of the slow down in the economy.
However, I still feel very confident about the amount of due diligence that we spent in reviewing credit files prior to reaching the agreement with them. As well as the fact that we currently have the firm that does our external loan review is currently on site doing a through loan review for us as we speak. And we should have those results here within the next week to ten days.
Christopher Marinac – Fig Partners, LLC
Okay, and with that in mind if you can kind of think pro forma in terms of how your allowance covers looks once they are in near fold, do you want your coverage ratios to be similar to where you have it now or are you willing to have those dip down slightly until you work through some of the issues that you inherit from them?
William J. Small
Well, I don’t think that we want to see them dip any lower than where they are right now. We are very, very comfortable with our allowance in all of our ratios right now as we stand here today. Knowing with looking at the portfolio up there and such, I certainly don’t think that we are going to want to put ourselves in a position of letting those getting any thinner.
Christopher Marinac – Fig Partners, LLC
Okay, and then two other minor questions, the write down that Jack mentioned of $598,000 that is not classified as a charge-off. That is just a write down to OREO.
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