Another small community bank has announced plans to deregister its stock, extending a trend that emerged after passage of the Sarbanes-Oxley Act in 2002.
CKF Bancorp Inc. in Danville, Ky., said it would file an application with the Securities and Exchange Commission this month to terminate its registration. The $153 million-asset company stopped trading its stock on the Nasdaq stock market on Friday.
John H. Stigall, CKF's president and chief executive, said in a Dec. 29 press release that going private would result in "significantly reduced accounting and legal fees."
Going private frees companies from the obligation of filing SEC reports detailing their activities.
A number of community banks have complained about increased compliance costs in the wake of Sarbanes-Oxley, and over the past 11 months at least 10 have gone private or announced plans to do so. John Blaylock, a senior associate with Alex Sheshunoff Management Services Inc. in Austin, said small community banks can spend as much as $400,000 a year on SEC-related compliance.
Last week the $223 million-asset KS Bancorp in Smithfield, N.C., said it was going private after seven years as a public company.
Wells Financial Corp. in Wells, Minn., said last month that it would deregister its stock, but its plan to go private has been complicated by a New York hedge fund's unsolicited offer to buy the $232 million-asset company.
On Thursday the $152 million-asset AMB Financial Corp. in Munster, Ind., announced it had terminated its listing on the Nasdaq stock market and begun trading on Nasdaq's over-the-counter bulletin board. It will still have to file SEC reports but will save "significant compliance, professional, and listing costs," said Clement K. Knapp, AMB's president and CEO.
