Source Capital To Repurchase Stock

Source Capital Corp. will buy back as many as 1 million of its common shares, Chief Financial Officer Lester Clark said Tuesday.

The shares are undervalued on the NASDAQ Electronic Bulletin Board, he said, and the repurchase program will increase the liquidity for shareholders who want to sell.

Source, a Spokane-based maker of commercial loans usually secured by real estate, has slightly more than 7 million shares outstanding.

Clark said the shares are selling for $1 to $1.25, compared with a book value of about $1.54. Trading volume has been low.

“It’s basically a way to get the number of shares down,” he said. “We think it’s a good buy.”

After tax earnings have increased from $158,000 in 1991 to $936,000 in 1994; assets have tripled to $21.1 million, and shareholders’ equity has doubled to $11.3 million.

But, Clark said, the value of the stock peaked about a year ago at $1.90 per share.

He said Source’s board of directors will review the repurchase program periodically to determine the number of shares that should be purchased, and the appropriate price.

The program, which received a 2-year authorization, could be canceled at anytime.

, DataTimes