Bank of Florida Corp. unveiled a two-pronged capital-raising plan Friday to raise a projected $45 million, with shares outstanding potentially surging toward 100 million from the current 13 million.
The credit-crisis has hampered the company, which is suffering from soaring loan losses amid Florida being one of the nation's hardest-hit real estate markets.
Separately Friday, the bank announced it would take a $38.8 million writedown in the fourth quarter on tax credits it might have been able to offset future profit. Chief Executive Michael McMullan said the move was due to expectations for the company's loan-loss provisions and charge-offs this year.
Bank of Florida intends to offer approximately 38.9 million shares through a rights offering and then a supplemental offering of 44.6 million. Shareholders as of last Monday will receive through the rights offering the ability to purchase three shares for each one they have at a to-be-determined price. The stock closed Thursday at $1.30 and weren't active premarket. Shares, which hit a seven-year low in December, is down about two-fifths in the past year.
Bank of Florida said it would use about $37 million to capitalize its subsidiary banks so they regain "adequately capitalized" status. It also expects to use a portion of the net proceeds to redeem any of its outstanding series B preferred stock that aren't converted by holders.
The company operates bank branches in southeastern and southwestern portions of Florida, as well as the Tampa Bay area.