AmericanWest Bancorp, of Spokane, satisfied a Nasdaq rule April 9 when it issued a press release saying its 10-K annual report included an auditor's opinion that contained "a going concern qualification."

In such a qualification, an auditor says that a company might not be able to continue to operate as a going concern, but AmericanWest filed its 10-K and fourth-quarter earnings statement March 31 without issuing a press release.

The company delayed its 10-K until near the end of the filing deadline because "we wanted to make absolutely sure that there weren't going to be changes" to it, says Patrick J. Rusnak, AmericanWest's president and CEO. He says that "dozens" of banking companies earlier had issued their 10-K reports only to revise them afterwards.

American Banker reported Aug. 2 that more than a half-dozen companies, including AmericanWest, had disclosed in the previous week that their auditors had said there was substantial doubt about their ability to continue—and financial industry observers said many more such warnings were to come.

"I would expect us to see the amount go higher than it has ever been before for financial institutions," Daniel Trigg, a partner with the national CPA firm of McGladrey & Pullen LLP, of Bloomington, Minn., said in the article. An auditor can issue a going concern qualification for any type of publicly traded company.

AmericanWest has been trying to raise $57 million in capital under the U.S. government's Troubled Asset Relief Program, but has said the government is requiring it to raise a like amount of private capital first.

Rusnak, interviewed on Monday, April 20, said, "We have significant nonbinding commitments of private equity" from investors, but the company does not yet have a definitive agreement from investors to buy common stock in the private fundraising it's trying to bring about.

Just $105 million was raised in the U.S. during the first quarter in the type of bank and savings-and-loan common-equity offering AmericanWest is attempting, Rusnak says. An analyst in the American Banker article said AmericanWest is one struggling banking company that has the potential to attract capital.

In its April 9 press release, the company referred to statements in its 10-K that it "will continue to vigorously pursue contacts and discussions with prospective investors and is confident that if the conditions in the capital markets improve over the coming months, the prospects for success in these efforts will substantially increase."

It also said it is continuing to evaluate opportunities for significant divestiture of assets, including the sale of deposits, performing loans, and related branch banking facilities, which would reduce its required level of capital.

Yet, Rusnak says, "It would be our preference to raise the capital and keep our franchise intact. It's also the preference of our lead investors. We could sell the best part of the company at a depressed price. We would make less money the next day, although we would need less capital." He said the statement about possible divestiture of assets was included in the 10-K to show, "Everything is on the table, everybody is engaged, we have good financial advisers."

The company says it had record mortgage loan volume in the first quarter of 2009, funding $123.4 million in mortgages, compared with $55 million in the year-earlier period, and that related fee income in the first quarter this year exceeded 200 percent of the previous quarter's. It would not release the amount of that income because it hasn't released its first-quarter earnings, although Rusnak says he expects the company will do that on April 30.

"The fundamental underlying parts of this company are working," he says. They include its core deposit base and mortgage side, and aside from the company's construction and development loans, it has a well-developed loan portfolio, Rusnak says.

Other than for a "thin segment" of problematical residential development in its Utah service area, the areas in Washington, Idaho, and Utah where it does business have a solid base and a foundation for long-term growth, he says.