Southeast Acquisition Holding Corp. in Coconut Grove, Fla., has kicked off what it hopes will be a buying spree in South Florida.
Southeast said Wednesday that it has a deal for the $90 million-asset First Bank of the Palm Beaches in West Palm Beach. The price was not disclosed.
Kent S. Ellert, a former Wachovia Corp. executive and Southeast's chief executive, said it is talking with other targets and expects to strike more deals. The company was started last year to buy Florida banks on the cheap.
Ellert said First Bank has a "fortress balance sheet" but lacks sufficient capital to continue its business plan. "We anticipate more than doubling the capital base of the bank," Ellert said.
On March 31, First Bank's noncurrent loans made up only 0.34% of total loans, well below the averages of 5.29% for Florida institutions and 2.93% for banks nationwide.
Ellert said now is the perfect time to expand in Florida, because so many competitors are still working through problem loans and pulling back from the market. "It is limiting the banking capacity of clients who need banking services," he said. "It is important to be in the business with a clean and healthy portfolio, as a lot of the banks continue to be internally focused."
The deal is expected to close next quarter.