NEW YORK—Doral Financial Corp.'s loss narrowed in the first quarter as the Puerto Rican bank paid less to raise cash for loans, the company said Tuesday.
Doral Financial lost $10.6 million, or 20 cents per share, in the first quarter, compared with a loss of $45.6 million, or $8.45 per share, in the first quarter last year.
Analysts polled by Thomson Financial forecast a loss of 44 cents per share.
Profit from lending rose 2 percent to $39 million from $38.2 million. The company earned more from lending because it did not pay as much to raise cash for loans.
Banks typically borrow money at a low interest rate and lend the money at a higher interest rate, profiting off the spread. In July, the investment group Doral Holdings invested $610 million in the bank. The company used this investment to pay off $625 million in bonds.
This enabled the company to raise money more cheaply.
Doral lent $372.1 million during the first quarter, a 50 percent increase from the first quarter of 2007.
Shares gained 50 cents, or 2.5 percent, to $20.20 in aftermarket electronic trading, from their regular session close at $19.70.
