Columbia-based Community First Bank & Trust continued to improve its capital position in the third quarter, when it posted a profit of $290,000 versus a loss of $1.4 million a year earlier. The absence of a $2 million loan loss provision helped a lot but the company also cut expenses by $800,000, more than offsetting a $375,000 drop in net interest income. As of Sept. 30, Community First needed to close a $2.1 million gap to get all of its capital ratios in compliance with the Federal Deposit Insurance Corp.'s consent order. (Search here for "2,100.") That's down from $7 million early this year and $5.1 million in June.
Community First Bank & Trust, which has been on a slim-down push to help it reach regulators' demands for more capital, posted a second-quarter profit of $98,000. That was up from $62,000 in the spring of 2012. Net interest income fell by some $900,000 from the year before — the Columbia-based bank ended the quarter with assets of $467 million, down 18 percent from mid-2012 — but execs were able to trim almost $700,000 in costs and didn't take a loan loss provision during the quarter.
Community First's leadership team has been steadily whittling down its post-recession capital gap and now needs "only" another $5.1 million to get to the FDIC's target for that metric. Search here for "7.45%" to see all the ratios.
Executives at regional bank holding company Synovus Financial on Friday said they plan to redeem $968 million in preferred shares issued to the U.S. Treasury under the Troubled Assets Relief Program. The Georgia-based parent of The Bank of Nashville plans to sell $315 million in common and preferred shares and fund the rest of the payback through an upstream dividend from Synovus Bank.
“Today’s announcement of our planned TARP redemption represents the culmination of a journey to return Synovus to a position of strength,” said Kessel Stelling, Synovus Chairman and CEO. “We laid out and successfully executed a clear, deliberate, and aggressive plan to return Synovus to sustainable profitability. Key components of the plan included taking significant actions to strengthen credit quality, stabilize and remix the balance sheet, and improve operating efficiency while investing in the talent and technology that will enable us to support growth and enhance the customer experience.”
Bank holding company Community First Inc. continues to make progress toward the capital levels imposed on it by the Federal Deposit Insurance Corp. in September 2011 even though it posted only a tiny first-quarter comprehensive profit. The parent of Community First Bank & Trust now needs $7 million in capital to meet the FDIC's heightened requirements, which means it may still have put its shareholders through a very dilutive stock offering. But the gap is now $4 million smaller than it was at the end of 2012, which was itself a decent improvement from Q3's $15.3 million.
Another note from the company's quarterly report filed last week: Because Community First has missed six straight dividend payments on the $18 million of preferred stock it sold to the U.S. Treasury four years ago, the feds now have the right to put two representatives on the company's board.
The parent of Community First Bank & Trust out of Columbia posted a third-quarter net loss of $1.7 million, a number that would have been higher but for almost $700,000 in gains from the sale of securities. Community First Inc., which has been operating under various regulatory orders for almost two years, has been steadily adding to its capital cushion in the last two years. The pending sale of its high-profile Cool Springs branch will bring in more cash. And shedding more assets will help, too. But CEO Louis Holloway and his team still have a lot of heavy lifting to do: The company needs $15.3 million to meet the heightened capital requirements laid out by the Federal Deposit Insurance Corp.
After a brief delay due to superstorm Sandy, officials at the U.S. Treasury on Thursday wrapped up their latest auction of their preferred stock and subordinated debt holdings in 11 community banks from around the country. Among the investments up for sale was $8.7 million worth of preferreds issued by the parent of Lebanon's First Freedom Bank. A successful auction will make six-year-old First Freedom the fourth area community bank holding company to exit TARP's Capital Purchase Program, following the parent companies of Avenue Bank, Pinnacle Bank and Clarksville's F&M Bank.
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