“We expect that this initiative willsave us approximately $3.0 million in 2009. We are employing a disciplinedapproach to cost management that will not impede our ability to grow.”Income TaxThe provision for income taxes for the first quarter of 2009 decreased $1.3million from the same period in 2008 primarily due to the decrease in incomebefore taxes offset by a decline in nontaxable income and tax credits. FirstCommonwealth’s effective tax rate was 3.5% in the first quarter of 2009compared to 11.1% in the comparable quarter in 2008. Thesethree loans had $14.8 million allocated to the allowance for credit losses atDecember 31, 2008.Nonperforming loans as a percent of total loans decreasedfrom 1.27% at December 31, 2008 to 0.65% at March 31, 2009 primarily as aresult of these transfers.
Net credit losses for the first quarter of 2008,totaled $4.0 million.Loans past due in excess of 90 days and still accruing at March 31, 2009increased $1.3 million to $17.5 million compared to December 31, 2008primarily due to an increase in commercial loans.The provision for credit losses for the first quarter of 2009 increased $5.1million compared to the first quarter of 2008. The single issues are primarily from moneycenter and large regional banks. The pooled instruments consist of securitiesissued by 376 banks and other financial institutions. Two of our pooledsecurities are senior tranches and the remainder are mezzanine tranches. Thesenior and mezzanine tranches of trust preferred collateralized debtobligations generally are protected from defaults by over-collateralizationand cash flow default protection provided by subordinated tranches, withsenior tranches having the greatest protection and mezzanine tranchessubordinated to the senior tranches. At the time of initial issue, thetranches subordinated to our senior and mezzanine tranches ranged in size fromapproximately 7.3% to 35.4% of the total principal amount of the respectivesecurities, and no single issuer comprised more than 5.0% of the totalprincipal of the pool.As of March 31, 2009, our single issue securities had a book value of $24.0million and an estimated fair value of $14.2 million, while the book value ofthe pooled securities totaled $95.0 million with an estimated fair value of$36.7 million.
Additional detail related to our pooled trust preferredsecurities is provided in the Consolidated Selected Financial Data portion ofthis press release.During the first quarter, all of the pooled instrumentswere downgraded by Moody’s Investor Services. Two of the fifteen pooledissues, representing $12.5 million of the $95.0 million book value, remainabove investment grade. In the first quarter of 2009, an $8.4 millionother-than-temporary impairment charge was recorded on four trust preferredcollateralized debt obligations that are expected to experience a principalshortfall. These obligations include Pre TSL VI, Pre TSL VII, Pre TSL VIII andMM Comm IX.The amount of impairment charge recognized represents theexpected credit loss on these securities. Based on management’s analysis as ofMarch 31, 2009, all of the single issues and the remainder of the trustpreferred collateralized debt obligations are expected to return 100% of theirprincipal and interest.Use of Non-GAAP Financial MeasureThis release includes core net income, core non-interest income and corenon-interest expense which are non-GAAP (Generally Accepted AccountingPrinciples) financial measures that are calculated by excluding impairmentlosses, securities gains and losses and asset impairment charges from GAAP netincome, GAAP non-interest income and GAAP non-interest expenses.
Managementbelieves that these core measures are useful to the investment community inanalyzing financial results and trends of First Commonwealth. This informationfacilitates comparisons with prior periods and reflects the principal basis onwhich our management internally monitors financial performance. Forward-looking statementscan be identified by the fact that they do not relate strictly to historicalor current facts and often include words such as “believe,” “expect,”"anticipate,” “intend,” “plan,” “estimate” or words of similar meaning, orfuture or conditional verbs such as “will,” “would,” “should,” “could” or”may.”Forward-looking statements describe First Commonwealth’s future plans,strategies and expectations. Management believes that thesecore measures are useful to the investment community in analyzingfinancial results and trends of First Commonwealth. Lipkus III, Executive Vice President and ChiefFinancial Officer +1-724-349-7220, or Media: Susie Barbour, Communications &Media Relations Supervisor +1-724-463-5618, both of First CommonwealthFinancial Corporation. BSD Medical Corporation — Tacoma/Valley Radiation Oncology Centers Provide NewCancer Treatment in Pacific Northwest With Acquisition of BSD-500 HyperthermiaSystemTACOMA, Wash., April 23, 2009 (GLOBE NEWSWIRE) — BSD Medical Corporation(Nasdaq:BSDM) is pleased to announce that the Tacoma/Valley Radiation OncologyCenters in Tacoma, Washington, have become the first oncology centers in thePacific Northwest to acquire the BSD-500 Hyperthermia System. This placementemphasizes the ever growing use of hyperthermia therapy throughout the UnitedStates.
The addition of the system significantly adds to the multidisciplinaryarsenal of cancer treatment options Tacoma/Valley Radiation Oncology Centersprovide to the Puget Sound region. “We are pleased to have this modality tooffer our patients,” said Randy Sorum, MD of Tacoma/Valley Radiation OncologyCenter.About Tacoma/Valley Radiation Oncology CenterCelebrating over 30 years of operation, Tacoma/Valley Radiation Oncology Centers(TVROC) has been recognized as a major provider of radiation oncology servicesin the Puget Sound region. TVROC offers comprehensive care, advanced technologyand innovative treatments to cancer patients.About BSD Medical CorporationBSD Medical Corp. is a leading developer of systems used to deliverprecision-focused microwave/RF energy to diseased sites in the body, includingcancer. Its treatments are used to kill cancer directly and increase theeffectiveness of companion radiation treatments for certain tumors. For furtherinformation visit BSD Medical’s website at contained in this press release that are not historical facts areforward-looking statements, as defined in the Private Securities LitigationReform Act of 1995.