MANATEE — First Banks Inc. has reached an agreement to sell its entire Florida footprint just four years after acquiring the operation from financially-troubled Coast Bank, federal records show.
The deal will hand an unaffiliated financial institution that has yet to be identified all 19 Florida branches, including nine in Manatee County, for what equates to just under $8 million, according to the Security Exchange Commission.
It’s unclear exactly what assets the buyers will assume.
Since acquiring the offices, First Banks has seen its Florida deposits cut in half to reach $349.5 million, the latest figures available.
The agreement reached as part of the sale with allow the buyer to assume those deposits and other assets for a premium of 2.3 percent, or $7.95 million.
The buyer also has agreed to purchase all of the equipment at the 19 locations, while maintaining the same leases at a discount of $1.2 million, according the SEC filing.
“The company’s principal subsidiary, First Bank, is a party to an agreement to sell certain assets and transfer certain liabilities associated with its 19 retail branches located in Florida,” First Banks President and CEO Terry McCarthy said in a statement. “At this time, the company does not intend to provide further comments regarding the agreement.”
First Bank purchased the locations for $12.1 million in 2007 after Coast Bank struggled to overcome mortgages written at the height of the housing boom and home construction loans to now bankrupt builders.
The lender also had been dragged down by financial damages stemming from a criminal investigation involving one of its top executives, Philip Coon, who now is serving an 18-month prison sentence, records show.
Industry insiders believe Missouri-based First Banks just never was able to recover from those losses. The Coast acquisition was its first run in the Florida market.
Because the new sales price is so depressed, the buyer may be able to obtain an instant and near dominant presence in the market, which now is begging to rebound, said Frank Knautz, a banking consultant in the Bradenton-Sarasota area.
“It appears a large, well-staffed market presence is available for a relatively small price,” Knautz said. “As the economy improves, the buyer will be well-positioned to garner market share in a rebounding economy.”
First Bank reported $5.8 billion in company-wide deposits as of Dec. 31, according to the annual report filed Friday. The company employs about 1,171 full-time equivalent workers through 147 banking centers between Florida, California, Illinois and Missouri.