El Banco Financial Corp.'s bid to become an independent banking company has hit a roadblock.
The Roswell, Ga., company's plan to buy NBOG Bancorp. Inc. in Gainesville, Ga., was dropped because both sides concluded "that receipt of regulatory approval would not be forthcoming on a timely enough basis," according to an Oct. 26 filing with the Securities and Exchange Commission.
El Banco announced in May that it would buy the $37 million-asset NBOG for $6.5 million. The companies' decision to call off the deal was first reported in Friday's Atlanta Business Chronicle.
Drew Edwards, El Banco's chairman and chief executive officer, said in a brief interview Monday that the decision was voluntary and in the best interests of both companies.
El Banco targets Hispanics who have had little or no contact with traditional banks; it operates 12 retail offices in the Atlanta area under a licensing agreement with SunTrust Banks Inc. Its offices operate under the name El Banco de Nuestra Comunidad, which means "Bank of Our Community."
The NBOG deal would have given El Banco its own banking charter. Mr. Edwards said El Banco would not seek another acquisition target but may consider applying for a charter. He also said the deal's collapse would not affect El Banco's decision to become a publicly traded company. (El Banco said in an SEC filing this year that it planned to raise about $35 million in a public offering.)
NBOG is the parent company of National Bank of Gainesville, which was founded in 2002. Since August 2004, it has operated under a formal agreement with the Office of the Comptroller of Currency to address its capital-to-asset ratios and lending policies, among other things.
