Delmarva Bancshares in Cambridge, Md., has raised $11 million through a private placement.
The $195 million-asset company said Monday that it sold common and preferred stock to a group that includes Castle Creek Capital. Delmarva said it plans to contribute most of the capital to its National Bank of Cambridge so it can sell the majority of its problem assets.
"We are extremely pleased that we were able to consummate this transaction in a timely manner," Kim Liddell, the company's chairman and president, said in a press release. "We believe this new capital will enable us to execute our strategic plan, which includes significantly reducing nonperforming assets, resolving the bank's formal agreement with the OCC, and positioning the bank to take advantage of market opportunities."
The bank earned $195,000 through the first nine months of last year, according to a filing with the Federal Deposit Insurance Corp. Nonperforming assets made up 10.11% of total assets at Sept. 30, Liddell said in an interview. He declined to discuss how many assets the bank could sell, though he said "there is going to be a dramatic difference" after the sales.
Raymond James was the placement agent. Alston & Bird served as legal counsel to Raymond James, while BuckleySandler served as Delmarva's legal counsel.