Martinsville-based Carter Bank said Thursday that the interest income it has lost from overdue loans owed by U.S. Sen. Jim Justice and his family companies rose $7.9 million in the fourth quarter to total $65.1 million.
The bank has been losing interest income on the loans since mid-2023, when it placed the Justices’ portfolio, worth more than $300 million at the time, in nonaccrual status. Nonaccrual status is when loans don’t earn interest because payments aren’t made.
Carter Bank CEO Litz Van Dyke said in a news release that although the Justices’ portfolio continues to negatively impact the company’s financials, overall the bank’s status is solid.
“We continue to feel positive about the fundamentals of the Company and the structure of our balance sheet,” Van Dyke said.
The Justice family companies paid $28.9 million toward their loans in the fourth quarter, bringing the balance down to $252 million.
Jim Justice, a Republican, was sworn in earlier this month to the U.S. Senate seat vacated by former Democrat Joe Manchin of West Virginia. Justice had served as West Virginia’s governor since 2017.
The family companies own coal, agricultural and hospitality businesses in Virginia, West Virginia and North Carolina, including The Greenbrier luxury resort in White Sulphur Springs, West Virginia.
The Justices collectively are Carter Bank’s largest borrowers, and their loan balance represents 97% of the bank’s nonperforming loans. The loans are personally guaranteed by Justice; his wife, Cathy; and their son, Jay.
The Justice companies previously owed the bank as much as $775 million before paying that down to approximately $300 million in April 2023, when the loans became overdue and the bank took legal action seeking repayment.
The portfolio has been the focus of years of legal actions. In June, the bank and the companies announced that they had reached a settlement regarding repayment.
Before that, the bank and the Justices clashed in the courts for several years. The Justices alleged that the bank stymied their repayment plans to preserve interest income, while the bank accused the Justices of stalling their repayment; each side denied the allegations against it.
Carter Bank has $4.7 billion in assets and more than 60 branches in Virginia and North Carolina.
Carter Bank’s latest numbers on the Justice family loans came as its parent company, Carter Bankshares Inc. (NASDAQ:CARE), reported a fourth-quarter profit of $8.3 million, or 36 cents per share, up from a net loss of $1.9 million in the fourth quarter of 2023.
The bank’s full-year profit was $24.5 million, or $1.06 per share, up from $23.4 million in 2023.
During the fourth quarter, the company bought two bank branches in Winston-Salem and Mooresville, North Carolina, from Florence, South Carolina-based First Reliance Bank.
The bank also celebrated its 50th anniversary. In 1974, the First National Bank of Rocky Mount opened; it would later be the oldest of the 10 banks that later merged to form Carter Bank & Trust.
While the bank’s name legally remains Carter Bank & Trust, the company dropped the “& Trust” from its logo last quarter as part of a refreshed branding.
