CertusBank in South Carolina to Acquire SBA Lender

CertusBank in Greenville, S.C., plans acquire the small business lending operations of a struggling Georgia bank.

The $1.8 billion-asset bank said in a press release Wednesday it would buy Quadrant Financial from the $500 million-asset First Chatham Bank in Savannah. By dollar amount, Quadrant is the largest originator of loans guaranteed by the Small Business Administration in South Carolina and is the 22nd largest in the country, CertusBank said in a press release.
 
“It positions us perfectly to expand our small to mid-size business platform in the Southeast, especially in our headquartered state of South Carolina,” said Walter L. Davis, co-chief executive of CertusBank, in a press release.
 
Quadrant’s co-founders and leaders, John Handmaker and George Vredeveld, are expected to continue to lead the business, which has offices in eight states. The banks did not disclose a price or say when the deal is expected to close.

Deals for specialties and niches are on the rise, as banks look for ways to find revenue in an environment with fierce competition for loans and low interest rates. For example, last month Sterling Financial (STSA) in Spokane, Wash., agreed to buy American Heritage Holdings, also a highly ranked SBA lender, for $6.5 million in cash.
 
The deal comes at a good time for First Chatham, too. The bank was undercapitalized at the end of the third quarter, with a leverage ratio of 4.15%. A 2010 consent order with the Federal Deposit Insurance Corp. requires that ratio to be at least 8%.

CertusBank said the SBA business would benefit from its capital position. The bank was a 2010 shelf charter and was backed by a $500 million blind pool. It has acquired three failed banks since then. It also announced it would buy a North Carolina mortgage company in July and it acquired an Atlanta broker/dealer in 2011. At Sept. 30, its leverage ratio was 13.33%.