Susquehanna Bancshares, Inc. Investor Investigation Of Possible Securities Laws Violations

If you purchased Susquehanna Bancshares, Inc. (NASDAQ: SUSQ) shares between January 28, 2009 and April 13, 2009 or before January 28, 2009 you have certain options and you should contact the Shareholders Foundation, Inc immediately!

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Company Name(s): 
Susquehanna Bancshares
Affected Securities: 

Investigation on behalf of inventors in Susquehanna Bancshares, Inc. (NASDAQ: SUSQ), who purchased Susquehanna’s common stock between January 28, 2009 and April 13, 2009, over possible Federal Securities Laws Violations by Susquehanna Bancshares, Inc announced.

According to the investigation by a law firm the investigation focuses on investor claims over potential violations of the federal securities laws by Susquehanna Bancshares, Inc. (NASDAQ: SUSQ) for potential. On January 28, 2009, Susquehanna Bancshares, Inc announced its fourth quarter and full year 2008 results, including net income of $0.21 per diluted share for the fourth quarter of 2008. In that announcement, Susquehanna Bancshares, Inc stated that it had increased its provision for loan and lease losses to $63.8 million for the year ended December 31, 2008. Susquehanna Bancshares, Inc also increased its provision for loan and lease losses to $15.5 million for the fourth quarter of 2008. With respect to its capital position, Susquehanna Bancshares, Inc stated as follows:

“On December 12, 2008, Susquehanna Bancshares completed its $300 million nonvoting senior preferred stock issuance to the U.S. Treasury under its TARP Capital Purchase Program. The issuance brought additional strength to Susquehanna’s already well-capitalized position during the quarter. At December 31, 2008, Susquehanna’s capital ratios were all above the minimum level required to be categorized as “well capitalized”.

On January 29, 2009, Susquehanna Bancshares, Inc held a conference call to discuss its earnings announcement. During the call, CEO and Chairman, William Reuter, in addition to noting the “challenging economic times”, highlighted the company’s strong track record and potential growth in 2009:

“These results point to the strong track record we have in making loans to advance responsible homeownership and economic growth in our communities. We plan to build on this foundation going into 2009 with overall loan growth projected at 8%....We believe this level of loan growth is achievable and responsible in the current climate, which requires us to carefully balance our support of economic growth with the need to manage credit quality in our portfolio.”

However, during the January 29 conference call, one of the analysts questioned certain inconsistencies regarding the above statements as follows:

“Just to follow-up, Bill, in your initial comments, obviously you indicated 2009 is going to be a challenging year, but yet, it seems to me that your targeted goals here don’t reflect this challenge. We talked about the loan growth, but in general, to me, that doesn’t necessarily reflect a challenging year. “

Additionally, an equity research report issued by RBC Capital Markets on January 30, 2009, stated with regard to the Company’s loan loss provision that “EPS was better than our very low expectations due almost entirely to a lower than anticipated loan loss provision and a higher than expected cut in salaries and employee benefits.”

On April 9, 2009, Susquehanna Bancshares, Inc issued a press release stating that its first quarter 2009 diluted earnings per common share expected to be released on April 22, 2009 will be below expectations primarily due to an increase in the provision for loan losses from $22.5 million in the fourth quarter of 2008 to $35.0 million in the first quarter of 2009.

On April 13, 2009, the next trading day after the announcement, Susquehanna’s common stock (NASDAQ: SUSQ) declined by approximately 8% on heavier than usual volume to close at $9.74 per share, a decline of more than 22% from the per share price on January 28, 2009 after the earnings announcement.