Bank holding company Pacific Capital Bancorp, posted a $362.6 million quarterly loss as provision for loan losses quadrupled, and said it was evaluating strategic alternatives, sending its shares down as much as 23 percent.

The bank also said its Tier 1 leverage ratio was not sufficient to meet the minimum 8.5 percent that it had agreed to maintain with the Office of the Comptroller of the Currency.

It had a Tier 1 leverage ratio -- which measures a bank's ability to cover losses -- of 5.6 percent at June 30.

The Santa Barbara, California-based bank said it was evaluating strategic alternatives to strengthen its capital base. Sandler O'Neill is serving as the financial adviser.

The parent company of Pacific Capital Bank said it would focus on its three-year strategic and capital plan to boost capital levels.

It plans to sell about $150 million of real-estate secured loans by the end of 2009 and eliminate $45 million to $55 million in annual operating expenses by 2012.

In the second quarter, the bank's loan loss provision rose to $194.1 million.

Net loss available to common shareholders was $362.6 million, or $7.77 a share, compared with a net loss of $5.9 million, or 13 cents a share, a year ago.

Excluding a non-cash charge of $128.7 million related to goodwill impairment and a $25.6 million tax expense, the company posted a loss of $4.46 a share.

Two analysts on average had expected a loss of 58 cents a share, excluding items, according to Reuters Estimates.

Net interest income dropped about 17 percent to $53.4 million.

Shares of the company were trading down 13 percent at $2.25 Thursday afternoon on Nasdaq. They touched a low of $2.00 earlier in the day. (Reporting by Abhinav Sharma in Bangalore; Editing by Gopakumar Warrier, Anne Pallivathuckal)

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