FLORENCE, Ky. - Bank of Kentucky Inc. has agreed to buy most of the assets and liabilities of Peoples Bank of Northern Kentucky.
In a Securities and Exchange Commission filing last Wednesday, the $535 million-asset subsidiary of Bank of Kentucky Financial Corp. said it would acquire all eight of Peoples' branches, its ATM network, its deposits, and most of its loans. That portfolio does not include an $8 million credit to Erpenbeck Co., a home contractor in Edgewood, Ky., that was the source of recent troubles at $207 million-asset Peoples. The purchase price was not given.
In March it was disclosed that Erpenbeck had deposited nearly $30 million from home sales that was supposed to be used to pay off debt. According to published reports, Peoples Bank accepted the deposits even though employees knew Erpenbeck had outstanding loans with other banks. Peoples' president was forced to resign in April, and state and federal regulators investigated.
The deal, which is expected to close in October, would leave Peoples, in Crestview Hills, with about $40 million to settle a class action filed by Erpenbeck homebuyers and follow through with its suit against Erpenbeck.
