Question-and-Answer Session
Operator
(Operator Instructions) Our first question is from Jon Arfstrom – RBC Capital Markets.
Jon Arfstrom – RBC Capital Markets
I guess a question is for you, Ken. I was writing fast and furiously when you were talking but did you touch on the watch list at all and what those trends look like?
Ken Erickson
I did not but I can share with you. I’ll give you a quarter two, quarter three, quarter four results. We had total delinquencies of $83 million in quarter two, $100.8 million quarter three, $99.5 million in quarter four, so a slight decrease.
We saw an increase in non-performers from quarter three to quarter four as you saw of $37 million but we saw a reduction of about $8 million in those loans 60 to 89 days past due, and a reduction by about $28 million of loans that are 30 to 59 days past due. I guess addressed your question on delinquencies versus watch list. Those totals are approximately the same.
Jon Arfstrom – RBC Capital Markets
Lynn, maybe you or Ken when you talked about the six critical things that you’d be focusing on this year and you talked about decline in the non-performers and losses. I guess my question is with the prospect of the real estate owned balances increasing, how aggressive you plan on being in moving those credits off the balance sheet? Is this somewhere where you feel you can be patient or would you rather just move them off the balance sheet and move forward?
Lynn B. Fuller
At this point we’re in the process, Jon of categorizing those. We didn’t have a lot of OREO mid-year or third quarter, so this has become a new effort and we’re identifying those properties that we’d like to move immediately and those properties that we feel we’d just assume be a bit patient with.
We’re projecting that out for all of ?09 to try to get a better handle on where OREO should be given the effort of liquidating some and holding others, so that’s underway right now. We’re forecasting all of that out along with the forecasted non-performers, as Ken talked about, shocking the portfolios to see what potentially could end up going into additional non-performers if the economy continues to weaken.
Jon Arfstrom – RBC Capital Markets
Ken, in terms of the secondary market for those credits, is that they type of valuation that you use or that you plan on using when you value these credits?
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