ATB Financial today reported second quarter earnings fell 91% to $8.5 million for the period ending September 30, due mainly to a $79.6 million charge for potential losses and restructuring costs on third party asset-backed commercial paper (ABCP).

The ABCP provision reduced operating revenue to $137.6 million, down $48.2 million or 25.95% over the second quarter of the prior year.

Non-interest expenses also increased by $18.5 million or 16.49%.

ATB’s equity now stands at $1.7 billion, up 11.63% compared to Sept. 30, 2006.

“ATB Financial has year-to-date earnings of $73 million despite absorbing a $79.6 million ABCP provision. ATB Financial continues to have an excellent year and from an operating perspective had one of our strongest second quarters on record,” says Dave Mowat, president and CEO, ATB Financial.

“Although we remain optimistic that a restructuring of these investments will be successful, we cannot be completely certain of the final outcome. The first of these trusts to be restructured – Skeena, which represents $91 million of our holdings — has been done at par, however, there is still uncertainty on the process for the remaining trusts. We will be working diligently toward a successful restructuring, however, appropriate provisions are being taken at this time to reflect the situation’s uncertainty. The full extent of the ABCP restructuring should be known by year-end,” Mowat says.

ATB says its core operations continue to perform well. Investor Services attained $4 billion in assets under administration and management during the quarter, personal and business financial services experienced strong loan growth of $516.6 million, and corporate financial services attained favorable deposit growth of $72.5 million.