Centennial Bank Settles Suit Filed Against Unit

DOW JONES NEWSWIRES

Centennial Bank Holdings Inc. (CBHI) said Tuesday it has agreed to settle alawsuit filed against subsidiary Guaranty Bank & Trust Co. and a formerexecutive by fleeced investors.

According to a filing with the Securities and Exchange Commission, the Denverbank holding company incurred a a pretax charge of about $6.5 million inconnection with the settlement.

Its financial results for the quarter ended June 30 will be revised, andCentennial expects to report a quarterly net loss of $6.8 million, or 13 cents ashare. For the six months ended June 30, the loss recorded will be $1.4 million,or 3 cents a share, the company said.

The settlement stems from a 2005 lawsuit filed in a local court in Denver byvictims of convicted financier Will Hoover. According to news reports, theinvestors accused Guaranty Bank & Trust and its former chairman of helpingHoover conduct a Ponzi scheme in which he used money from later investors torepay obligations to earlier ones. The investors had sought as much as $50million in compensation, damages and legal fees.

Shares of Centennial Bank closed Monday at $5.74, down 46 cents, or 7.4%.

-Ingrid Pedrick Lehrfeld, Dow Jones Newswires; 202-862-1361

(END) Dow Jones Newswires 08-07-07 0610ET Copyright (c) 2007 Dow Jones & Company, Inc.