October 20, 2009 / 10:03 PM / 10 years ago

UPDATE 1-South Financial sees $341 mln Q3 loss on charges

* Sees Q3 loss/shr $1.95 vs $0.43 last yr

* Sees Q3 net interest income down 16 pct

* Sees Q3 loan-loss provision up 71 pct

* Shares fall 20 pct

Oct 20 (Reuters) - Financial services firm South Financial Group Inc TSFG.O expects to post a more than ten-fold jump in quarterly loss, hurt by a $200 million charge and a spike in loan loss provisions.

The company expects third-quarter net loss of $340.8 million, or $1.95 a share, compared with a loss of $31.2 million, or 43 cents a share, last year.

Analysts on average were looking for a loss of 44 cents a share, before items, according to Thomson Reuters I/B/E/S.

During the quarter, the company recorded income tax expense of $123 million, which includes the recognition of a $200 million non-cash charge to establish a valuation allowance for deferred tax assets, South Financial said in a statement.

Loan-loss provision rose 71 percent to $224.2 million, exceeding net charge-offs by $55.6 million.

Final quarterly results are pending completion of a goodwill impairment, South Financial said.

Shares of the Greenville, South Carolina-based bank were down 20 percent at $1.12 in after-market trade. They closed at $1.43 Tuesday on Nasdaq. (Reporting by Brenton Cordeiro in Bangalore; Editing by Pradeep Kurup)

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