Columbia-based Community First Bank & Trust is, as of Sept. 29, no longer operating under any sort of extra regulatory requirements. The bank, which runs eight offices in Maury, Hickman and Williamson counties, had been under an informal memorandum of understanding with regulators since late last year. As recently as 2012, the bank faced a $15 million capital gap as it tried to bounce back from the real estate bust and meet the stringent extra conditions regulators were demanding.
Said Chairman Eslick Daniel in a statement this week: “The board is excited to be planning our future with a focus on serving our community and shareholders rather than correcting the problems of the past. We appreciate the support our regulators have shown in our efforts to improve the health of the Bank, and believe that the lessons of our past will make us a stronger Bank in the future.”
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.
Veteran local banker Tommy Adair has joined Franklin Synergy Bank as vice president and credit department manager. Adair comes to Franklin Synergy from struggling Community First, which has been shrinking its asset base to comply with regulators' capital level mandates. He started his finance career at the former Williamson County Bank.
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.
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