Crescent Reports Mortgage Ops Adjustments

Crescent Banking Co., Jasper, Ga., has reported adjustments totaling $10.6 million in its mortgage banking operations as a result of overstatements of its gains on the sale of mortgage servicing rights and the value of mortgage loans held for sale.Crescent said the adjustments resulted from a review of its internal controls. As a result of inconsistencies between its mortgage banking software system and its MSR valuations, the gains on sale of MSRs had been overstated by approximately $3.9 million, the company said. In addition, it found a "potential overstatement" of mortgage loans held for sale totaling about $6.7 million. On an after-tax basis, the adjustments are expected to reduce the company's shareholders' equity by about $5.2 million as of Sept. 30, Crescent said. The company added that it expects to restate its previous financial statements to reflect the changes. Crescent can be found online at http://www.crescentbank.com.