Columbia Banking System, Inc. has announced a net quarterly loss applicable to common shareholders of $6.6 million. That loss compares to a net income of $1.9 million for the same period last year.

Revenue was $35.5 million for the second quarter of 2009, down 10 percent from $39.6 million one year ago. The decrease was primarily due to declining interest rates coupled with a decrease in outstanding loans.

On a diluted earnings per common share basis, the net loss was 37 cents, compared to earnings of 11 cents per share in the second quarter of  2008. The loss for the quarter reflected a provision for $21 million in loan losses caused by the continued decline in real estate values, principally relating to residential land, lots and lot development loans.

Earnings were also impacted by the accrual of $1.4 million during the second quarter for Columbia's share of the special assessment imposed by the Federal Deposit Insurance Corp. on all insured depository institutions as part of the federal bank recovery effort.

"The current economy and the continued decline of real estate property values remains an ongoing source of concern. However, we are continuing to improve our business and enhance our franchise where it makes strategic sense for us," said Melanie Dressel, bank president and CEO. "We have continued our disciplined deposit strategy, focusing on non-maturity products as we managed through a very competitive market. While our total deposits have decreased slightly, we have maintained our core deposits as we cultivate our customer relationships. This continuing focus on our core deposit clients and our community banking model position us well as the economy improves."

The bank has a total risk-based capital ratio of 14.61 percent, or about $113 million above the threshold set by the FDIC to be considered "well capitalized." Only 10 percent of the bank's total portfolio are loans in the real estate construction area, which continues to be a challenging segment in the Pacific Northwest, while 37 percent of the banks total portfolio is in commercial business loans.