Ailing Liberty Bank in West Des Moines, Iowa, is selling three more of its branches in its home state as part of an ongoing quest to trim overhead and bolster its capital levels.
Heartland Financial USA (HTLF), a multi-bank holding company based in Dubuque, Iowa, announced Friday that it is buying three branches from Liberty in and around its home town and will combine the branches with those of its lead bank, Dubuque Bank & Trust.
The $4.3 billion-asset Heartland has been eyeing expansion in the Dubuque marketplace and its chairman, president and chief executive officer, Lynn B. Fuller, said that the Liberty branches are "an excellent fit."
"This transaction represents an opportunity to grow our flagship bank...within the thriving Dubuque marketplace," Fuller said in a news release.
The branches include $55 million of deposits and $10 million of loans.
For the $934 million-asset Liberty, the branch sale would be its second so far this year; in February it announced that was
Liberty is under orders from its regulators to reduce its volume of problem loans and increase its capital levels, which have been depleted by steep losses on real estate loans in recent years. At Dec. 31, its total risk-based capital-to-assets ratio was 4.76%, well below the 12% mandated by its regulators in a cease-and-desist order issued against the thrift last year.
A price was not disclosed, so it is unclear what impact the sale will have on Liberty's capital ratios. The deal is expected to close next quarter.
