First NBC Bank in New Orleans has filed an application with the Federal Deposit Insurance Corp. and the Louisiana Office of Financial Institutions to acquire select assets and deposits of the $400 million-asset Central Progressive, according to a report in the New Orleans Times-Picayune Friday.
A deal could not come fast enough for Central Progressive. On July 25, regulators slapped the bank with a supervisory prompt corrective action directive, which gave the significantly undercapitalized bank 14 days to raise enough funds to become adequately capitalized. If that was unfulfilled, the directive called for the bank to take immediate action be acquired.
At June 30, Central Progressive's noncurrent loans made up more than 11% of total loans, according to the FDIC. Since the second quarter 2007, the bank has shed a third of its assets as it has struggled to get its arms around credit-quality problems and keep its capital ratios up.
The deal, if approved by regulators, would give First NBC a toehold on the north shore of Lake Pontchartrain. Founded in 2006 with $60 million of capital, First NBC now has $1.7 billion of assets and 13 full-service branches in Jefferson and Orleans counties.
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