Feds may force Corus Bankshares to sell itself

Corus Bankshares Inc., the Chicago- based bank that expects to be denied a government bailout, may have its well-capitalized status stripped by regulators and be forced to put itself up for sale.

"I think the expectation is that the company needs some sort of capital injection," Daniel Cardenas, an analyst at Howe Barnes Hoefer & Arnett, said today in a phone interview. "That would be an extremely difficult task to accomplish."

The bank in January reported its third consecutive quarterly loss amid a "housing calamity," and said it could lose its well-capitalized status. Corus may sell all or part of itself, the Wall Street Journal reported today, citing Chief Financial Officer Mike Dulberg. A call to Dulberg by Bloomberg News wasn't returned.

Corus applied for funds from the U.S. Treasury's Troubled Asset Relief Program in November. In a preliminary response, Treasury said it intended to reject the application, the bank announced in a statement Jan. 30.

About 25 percent of Corus's total assets are nonperforming and that the bank was "primarily" focused on condo construction in markets like Southern California, Atlanta, Las Vegas and Reno, Nevada, Cardenas said. "They're pretty much every place you don't want them to be," he said.

Corus fell 6 cents, or 15 percent, to 35 cents at 4 p.m. New York time in Nasdaq Stock Market trading. The stock has plunged 97 percent in the last 12 months.