First Interstate reclassified its Brazil loans.

The Los Angeles bank holding company said it has placed on non-accrual status $320 million of its Brazilian loans and $14.5 million of its Ecuadorean loans. The action reduces first-quarter profits by about $4.6 million, the company said. If payments do not resume by the end of the year, the bank estimates that net income will be cut by $15.4 million. The bank said it expects that Brazil and its commercial bank lenders will reach agreement on rescheduling the loans and that interest payments will resume before year-end.