United Community lifts reserve for loan losses
YOUNGSTOWN — The parent of The Home Savings and Loan Co. in Youngstown said Wednesday it will set aside about $13.3 million in the fourth quarter for loan losses.
United Community Financial Corp. said the amount could rise or fall, saying it will reveal the exact amount when it reports earnings Wednesday.
The provision mainly deals with construction loans but also beefs up general reserves due to higher risks in nonresidential and land development sector, including less flexibility among borrowers, falling real estate values and the weak economy in general, the bank said.
Although not involved in risky subprime loans, turmoil in the mortgage markets, weaker home prices and economic slowdown has led to a general decline in the bank’s credit quality, United Community said.
‘‘Controlling and resolving credit quality issues is our highest priority,’’ company Chairman and Chief Executive Officer Douglas M. McKay said.
