A plan to inject $50 million into U.S. Century Bank has been called off, leaving the undercapitalized Doral, Fla., bank in limbo.
A group of Miami investors called off the plan after the Dec. 31 closing deadline passed. The bank's board offered to extend the closing date by a month, but the investors balked and terminated the deal.
The cancellation was first
In May, a group of Miami investors led real estate developers James Tate and Sergio Rok,
The plan
The investors were also concerned that a number of more recent U.S. Century loans would have to be written down, which would require an infusion of more capital to restore the bank to well-capitalized status, Tuesday's Business Journal report said. Rather than extend the deadline, the investors opted to walk away.
In a letter to shareholders,
"[D]uring the more than nine months since the beginning of negotiations with Tate/Rok, the board believes that the bank has made important progress in critical areas including asset quality, liquidity and core earnings profitability," Acosta said in the letter. "As a result, the bank has moved toward a position to again operate as a profitable and viable banking franchise and, hopefully, to obtain alternate sources of capital."
The cancelation marks the second deal that has fallen through for U.S. Century in the last year. It had planned to sell itself to C1 Bank in St. Petersburg, Fla., but
The $938 million-asset U.S. Century is one of the nation's biggest undercapitalized banks, with Tier 1 capital of 5.1% and total risk-based capital of 7.28% as of Sept. 30, according to the Federal Deposit Insurance Corp. It lost $8.1 million in the first nine months of last year, according to regulatory filings.