North American Financial Holdings


North American Financial Holdings

North American Financial Holdings Inc. (NAFH) is a bank holding company which operates out of Charlotte, North Carolina but for regulatory purposes is headquartered in Miami, Florida. The nationally chartered NAFH National Bank operates as Capital Bank, which is based in Raleigh, North Carolina.[1][2] Former Bank of America vice chairman Gene Taylor is chief executive, former Bank of America executive and Fifth Third Bank CFO, Chris Marshall is CFO and former Bank of America executive, R. Bruce Singletary is Chief Risk Officer. Former Morgan Stanley research analyst, Kenneth Posner, manages research for NAFH. Its purpose is to take over banks that have had difficulties due to the financial crisis of 2007–2010, making money by paying low prices and then improving the banks' performance. The company's main interest was banks in the Carolinas and Florida, but in 2011, NAFH moved into Tennessee for the first time.

History

In December 2009, NAFH raised $900 million from such sources as private equity firms Crestview Partners, Oak Hill Advisors and Falfurrias Capital Partners. In March 2010 bank regulators granted NAFH a shelf charter, and the search began for banks to acquire.[3]

On June 29, 2010, Naples, Florida-based TIB Financial Corp., parent of TIB Bank and Naples Capital Advisors, announced that NAFH had agreed to invest $175 million in the company. Over the next 18 months, NAFH would have the right to invest $175 million more. The deal was completed in third quarter 2010.[4]

As of July 16, 2010, NAFH owned MetroBank of Dade County, Florida; Turnberry Bank of Aventura, Florida; and First National Bank of the South in Spartanburg, South Carolina. These four banks, after approval of the TIB deal, give NAFH $3.1 billion in assets,[3] and 10 branches in the Miami, Florida area and 13 in South Carolina, plus 28 more branches in southwest Florida with the completion of the TIB deal.[5] NAFH did not pay for the three banks it already owns, but instead divided loan losses with the Federal Deposit Insurance Corporation.

Hugh McColl, co-founder of Falfurrias and former Bank of America CEO, predicted NAFH would have $20 billion in assets in five to seven years.[3]

As of March 31, 2010, MetroBank had $442.3 million in assets with $391.3 million in deposits. Turnberry Bank had $263.9 million in assets with $196.9 million in deposits. First National had $682.0 million in assets and deposits totalling $610.1 million.[5]

On December 16, 2010, shareholders of Raleigh, North Carolina-based Capital Bank approved selling a majority interest to NAFH, which would buy newly issued stock rather than stock from existing shareholders.[6] Capital Bank began in 1997 as the Triangle's first new bank in eight years, after raising $26 million, the most for a new bank in the state's history.[7] By 2005, after expansion and buying other banks, Capital had $915 million in assets,[8] and by 2010, assets had reacherd $1.7 billion.[9] The Late-2000s recession hurt Capital, and regulators expected the bank to act. At one time, selling new stock was considered. Finally, Capital chose to accept help from NAFH.[10] The deal originally depended on NAFH being able to get a 50 percent discount on preferred stock and warrants held by the U.S. Treasury as a result of the federal stimulus.[6] However, in a January 18, 2011 interview, Capital CEO Grant Yarber said the federal government would get all its money back.[11]

On January 28, 2011, NAFH completed its $181 million deal for 85 percent of Capital. NAFH CEO Gene Taylor became CEO of Capital, replacing Yarber, whose new title was market president for North Carolina.[12]

All NAFH-owned banks continue to operate separately[citation needed] but the company has announced its intention to re-brand the banks as Capital Bank.[13] Capital had 32 branches before the deal, but after adding the four other NAFH banks, the total will be 84. Capital will keep its Raleigh headquarters.[11] Once the deal is closed, North American's banks will have more than $5 Billion in assets, placing them among the nations top 125 banks.

Late in April 2011, the Comptroller of the Currency approved merger of all of the banks into NAFH National Bank, a nationally chartered bank which will operate as Capital Bank. The Capital headquarters will remain in Raleigh's Capital Bank Plaza, where it relocated in 2006.[1]

On May 5, 2011, NAFH announced a $217 million deal for 90 percent of Greeneville, Tennessee-based Green Bankshares Inc., with 65 GreenBank branches and $2.5 billion in assets. GreenBank CEO Steve Rownd would be Tennessee market president. With the completion of this transaction in the third quarter, NAFH would have $7.3 billion in assets (putting the company in the nation's top 100 banks) and 149 branches in four states.[13]

In June 2011, NAFH filed with the SEC to raise up to $300 million in an initial public offering.[14]

References

  1. ^ a b "Capital Bank merger approved by regulators". News & Observer. 2011-04-30. http://www.newsobserver.com/2011/04/30/1164975/capital-bank-merger-okd.html. Retrieved 2011-05-21. 
  2. ^ "North American Financial Holdings Snapshot". http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=98045865. 
  3. ^ a b c Rothacker, Rick (2010-07-23). "New firm takes over 3 banks in a weekend". The Charlotte Observer. http://www.charlotteobserver.com/2010/07/23/1578009/new-firm-takes-over-3-banks-in.html. Retrieved 2010-07-27. 
  4. ^ "North American Financial Holdings, Inc. to Invest $175 million in TIB Financial Corp.". MSNBC. 2010-06-29. http://www.msnbc.msn.com/id/38003620/. Retrieved 2010-07-27. [dead link]
  5. ^ a b "North American Financial Holdings, Inc. Acquires Three Failed Banks from the FDIC". PRNewswire. 2010-07-16. http://finance.yahoo.com/news/North-American-Financial-prnews-745206427.html?x=0. Retrieved 2010-07-27. 
  6. ^ a b Ranii, David (2010-12-16). "Capital Bank shareholders approve deal". News & Observer. http://blogs.newsobserver.com/business/capital-bank-shareholders-approve-deal. Retrieved 2010-12-16. 
  7. ^ Joel B. Obermayer, "Capital Bank lives up to name," News & Observer June 24, 1997.
  8. ^ Frank Norton, "Bank plans to move downtown," News & Observer, November 2, 2005.
  9. ^ "Capital Bank Announces Financial Results for First Quarter of 2010". PRNewsire. 2010-04-27. http://www.prnewswire.com/news-releases/capital-bank-announces-financial-results-for-first-quarter-of-2010-92172649.html. Retrieved 2011-02-09. 
  10. ^ David Ranii, "Capital Bank merger outlined," News & Observer, November 6, 2010.
  11. ^ a b Ranii, David (2011-01-19). "Capital Bank to repay bailout". News & Observer. http://www.newsobserver.com/2011/01/19/929129/capital-bank-to-repay-bailout.html#storylink=misearch. Retrieved 2011-01-24. 
  12. ^ Ranii, David (2011-02-01). "Capital Bank reports loss". News & Observer. http://www.newsobserver.com/2011/02/01/959599/capital-bank-reports-loss.html#storylink=misearch. Retrieved 2011-02-05. 
  13. ^ a b Rothacker, Rick (2011-05-06). "N.C.-based North American plans to add a Tennessee bank". The Charlotte Observer. http://www.newsobserver.com/2011/05/06/1178677/nc-based-north-american-plans.html. Retrieved 2011-05-06. 
  14. ^ "North American Financial files for a $300 million IPO". Renaissance Capital. 24 June 2011. http://www.renaissancecapital.com/ipohome/news/North-American-Financial-files-for-a-$300-million-IPO-9846.html. Retrieved 27 June 2011. 

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