Question-and-Answer Session
Operator
Thank you, sir. (Operator's Instructions) And we'll take our first question from Ken Zerbe with Morgan Stanley.
Ken Zerbe - Morgan Stanley
Thanks. Can you just talk about the environment right now or the market for potential loan sales and I guess also address the agreement that you have with the OCC in terms of keeping your classified assets over your Tier 1 plus reserves to 100% and where do you stand on that currently?
Doyle L. Arnold
Well, to answer the second one first, there is no agreement with the OCC that requires us to get that ratio. What I have said is that it is a ratio that is of keen interest to the regulators, but there is no formal requirement that we hit that or any other particular ratio. I think on the whole we are probably right around that ratio around the 100% level. It varies a bit by bank, but that would be the other to that question.
In terms of loan sales, I think the best way to address that would be first of all to say that we work through about 26% of total classified assets. If you take the classified asset balances at the end of the second quarter, before any new inflows, we resolve 26% of those balances in the third quarter. Some of that was pay down, some of that was sales, some of it was charge offs, et cetera. Now, actual loan sales in the third quarter were a bit over $100 million that the two biggest components of that would be coming from California and from Nevada. And again, primarily those reflect basically selling one note at a time, not bulk loan sales. Did you want to have a followup on that, Ken, if I missed the mark?
Ken Zerbe - Morgan Stanley
No. I think you got it. I would have a followup, but sort of off the subject a little bit. The one thing I was just curious about was given your expectation for further reserve build, would you consider revising the pace at which you are raising the additional equity to accelerate that in coming quarters?
Doyle L. Arnold
Well, we raised about $188 million I believe it is in net common in the third quarter. And if I gross that is up $250-$275 million of loss and charge off.
Ken Zerbe - Morgan Stanley
- To read the full transcript on Seeking Alpha, click here »
