UPDATE 1-Macatawa Bank Q1 loss wider than expected

* Provision for loan losses up nearly 4-fold to $10.5 mln

* Net interest income falls 13 pct

April 20 (Reuters) - Macatawa Bank Corp (MCBC.O) posted a wider-than-expected first-quarter loss, hurt by higher provision for loan losses and costs associated with the administration of problem assets.

The Holland, Michigan-based company posted a quarterly net loss of $4.1 million, or 30 cents a share, compared with a profit of $2.4 million, or 14 cents a share, a year ago.

Two analysts on average expected a loss of 20 cents a share, before items, according to Reuters Estimates.

"The Michigan economy remains in transition. While we continue to see signs of gradual improvement, there are still significant inventories of unsold homes and lots in the market, and it will take time for these inventories to be absorbed," Co-Chief Executive Ron Haan said in a statement.

Shares of the company closed down 10 percent at $3.50 Monday on Nasdaq. For alerts, please double click [ID:nWNAB5163] (Reporting by Supantha Mukherjee in Bangalore; Editing by Deepak Kannan)