Investor group to acquire Savings Bank
Federal regulators have approved Gardiner-based Savings Bank of Maine's plan to stave off liquidation, which includes being acquired by a group of investors in order to increase the bank's capital.
The Office of Thrift Supervision -- which in March ordered the bank to double its capital-to-assets ratio to 10.76% -- has approved the bank's recapitalization plan, which includes a private stock offering and creating a new holding company to acquire the bank, according to the Kennebec Journal. The holding company, SBM Financial Inc., will take over Savings Bank's two existing holding companies, with money coming from an outside investment group led by John Everets, chairman of Boston-based Yorkshire Capital, and Willard Soper II, managing director of HFC Associates in Miami. It was unclear how much money the investment group would put forth or what management changes would be made, save that Soper would be the holding company's new president. The investors and bank's board of directors both declined to comment on the plan.
The OTS last August issued the bank a cease-and-desist order, saying the bank was engaging in "unsafe or unsound practices," including approving high-risk loans and operating with insufficient capital. The directive issued in March ordered the bank to meet the credit ratio by Sept. 30 or be liquidated. The bank recorded $77.6 million in loans not expected to be repaid at the end of March. The money from the investors will allow Savings Bank to pay down a multimillion dollar loan it took out to acquire Kennebunk-based Rivergreen Bank in 2008, on which the bank defaulted, according to the paper.
Go to the article from the Kennebec Journal >>
Most Recent
Most Recent
Comments