Liberty Financial Services in New Orleans is getting more financial help from a bank in the Deep South.
The $600 million-asset Liberty said in a press release Tuesday that it will redeem more than 11,000 shares of preferred stock it issued as part of the Troubled Asset Relief Program after receiving an investment from BancorpSouth in Tupelo, Miss.
Liberty said it will pay about $10.6 million to redeem the shares.
The $14.6 billion-asset BancorpSouth bought $8.5 million of preferred stock in Liberty, a community development financial institution and the third-largest black-owned bank in the country. Liberty focuses on low- and moderate-income communities.
"This investment reflects our continued focus on supporting the revitalization of under-served communities both in the markets we serve as well as neighboring markets," Dan Rollins, BancorpSouth's chairman and CEO, said in the release.
The move makes sense for BancorpSouth, which is trying to get two bank acquisitions back on track after its Community Reinvestment Act rating was retroactively downgraded in October from "satisfactory" to "needs to improve."
BancorpSouth is the second regional bank to make an investment in Liberty. Iberiabank in Lafayette, La., announced in October that it had invested $1.5 million for a less than 5% stake in Liberty.
BancorpSouth was represented by Alston & Bird. Liberty was represented by Adams & Reese.
