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Prosperity Bancshares Inc. in Houston announced Monday that it would acquire the 19 branches, including deposits of $500 million and assets of $100 million, from First Banks for a 5.5% deposit premium, or $27.5 million.
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The hits keep coming for the struggling Coast Financial Holdings Inc.
June 18
First Banks of Clayton, Mo., is exiting Florida roughly four years after it entered the state with the acquisition of the troubled Coast Financial Holdings.
The $6.6 billion-asset company said in a Securities and Exchange Commission filing Friday that it is selling its 19 branches in Florida and roughly $346 million of deposits for a premium of 2.3% to an unnamed buyer.
The planned sale is consistent with the company's stated goal of improving its capital ratios by shrinking its balance sheet.
The company, which has lost hundreds of millions of dollars in recent years on soured real estate loans, has been operating a written agreement with the Federal Reserve Board since March 2010 that required it to improve its underwriting practices, revise its credit administration procedures and maintain sufficient capital.
An active bank acquirer in the 1990s and early 2000s, First Banks has responded to the order by
The
First Banks' condition has been improving of late as it continues to shed problem assets. According to its most recent earnings announcement, it narrowed its loss from $212.1 million in 2010 to $62.5 million in 2011 primarily due to improved asset quality.
At Dec. 31, its bank unit had a core capital ratio of 8.19%, up from 7.4% a year earlier, according to data from the Federal Deposit Insurance Corp.
The Tampa Bay Business Journal first
The company gave no indication in the SEC filing who is buying the Florida franchise, saying only that it is an unaffiliated institution. It did not immediately return a phone call about the sale.