Single Post Display - MarketTicker Forums


	Detailed market commentary at The Market Ticker and Ticker Classics (The Year 2011 In Review) Donations accepted; we offer GOLD ACCESS for enhanced privileges. T-Shirts, caps, coffee mugs? Click here. BlogTalkRadio - Mondays at 3:30 Central - Yes, TickerGuy has a radio show (kinda) RSS available

MarketTicker Forums Single Post Display (Show in context)

User: Not logged on

User Info	Coast Bank, End of line..; entered at 2007-12-02 21:36:33
Crossthread Posts: 3457 Registered: 2007-09-04 Wilmington, NC	Bottom-dollar buyout end of line for Coast Bank Earlier news.. Aug. 30th Federal lawsuit: Coast Bank downfall started with easy money scheme Video link---> http://www.heraldtribune.com/article/200.... Updated news,, Dec 2nd First Banks Inc. of St. Louis completed its purchase Friday of floundering Coast, paying a rock-bottom price of $12.1 million, or $1.86 per share. That is $10 million less than the First Bank's original offer of $3.40 per share, a sign that Coast's loan problems had deepened in recent weeks. First Banks will move quickly to jettison the Coast name, which some say represents one of the biggest business busts in Manatee County history. Coast's 20 offices will adopt the new owner's brand on Dec. 10, said First Banks President Terry McCarthy. "We will be marketing First Bank's 100-year history in banking, making existing customers comfortable and pursuing customers who have left to try and bring them back," he said in an interview. McCarthy said it will take some time to clean up the loan problems and legal issues it inherits with Coast. "It's not a short-term project," he said. "We see it as a multi-year project, but we are very confident we will work through those issues." Coast's shareholders voted Monday to sell to First Banks, even though they did not know what the final price would be. In the merger agreement signed in August, $1.86 per share was the lowest the price could sink before either bank could back out of the deal. The 71/2-year-old bank had little choice but to sell at any price, given its crippled financial condition and damaged reputation since the loan crisis was revealed in January. The stock was trading at $16 before the problems surfaced. At that price, Coast would have fetched $104 million. Two of Coast's directors, vice chairman Michael Ruffino and Alex White, bailed out of the company for $2.60 to $2.67 per share three months ago. "It's been a tough 10 months," said Coast special adviser Tramm Hudson. "The bank was facing some very, very serious problems, and this was a good alternative to a very difficult situation." Hudson will pocket a $250,000 bonus for getting the deal done. First Banks will keep open all the Coast offices in Manatee, Hillsborough, Pinellas and Pasco counties. Up to 50 of Coast's 200 employees will lose jobs that overlap with First Banks. Anne Lee, the bank's acting president since May, will run the Florida operation as retail banking president. "This transaction provides a good opportunity for our employees to move forward and grow with a quality and dynamic organization," she said in a statement. Coast's size, $664 million in assets, and branch network offered an attractive entry for First Banks into Florida, McCarthy said. "We think, adjusted for risk, it is a value opportunity as well," he said. The new owner will not look to expand for a while, McCarthy said. "In the near term, we will focus on cleaning up and building on what we have acquired," he said. First Banks is one of the largest privately held bank companies in the country, with $10.3 billion in assets and, with Coast in the fold, 218 offices in five states. Its owner, James F. Dierberg, was briefly Coast's second-largest shareholder when he invested $5.3 million earlier this year. First Banks will take on more than $80 million in bad loans, more than 100 borrower lawsuits, and a federal lawsuit by shareholders who claim they were bilked by Coast officials who masked the bank's troubled condition. Coast has lost more than $50 million in the past four quarters. Its capital base, once topping $75 million, had fallen to $22.2 million as of Sept. 30. Many of its overdue loans involve borrowers with investment homes who stopped making payments when their builders went out of business and left unfinished homes. The Federal Deposit Insurance Corp. slapped Coast in May with a cease-and-desist order, ordering it to take a number of actions to improve its financial condition. A federal grand jury in Tampa is investigating Coast's loan dealings. The U.S. Securities and Exchange Commission also is looking into any possible violations of securities laws. Shares of Coast closed Friday -- and permanently -- at $2.10 per share. News of the deal's completion and the final sale price came after the close of trading.