Iowa Expected to Pass Legislation To Raise Deposit Ceiling to 15%
A bill that would raise Iowa's strict deposit cap has cleared the legislature, and the governor is expected to sign.The legislation, for which bank groups had lobbied, would raise the cap to 15% of the deposits in the state, from 10%.
Iowa looked into altering its cap after Firstar Corp. and Mercantile Bancorp maneuvered around the law in the fall.
State regulators gave the banks permission to merge even though they together controlled 13% of the state's deposits.
Firstar and Mercantile circumvented the cap by transferring some deposits out of state before merger approval and moving the funds back later.
The legislation would provide stronger enforcement measures to prevent that from happening again, bank groups said.
The House passed the bill 83-11 on March 30 after the Senate voted 43-5 for it in February.
John Sorensen, president of the Iowa Bankers Association, said he expects Gov. Thomas Vilsack to sign the bill this week.
- Craig Woker
Thrift Names Dissidents to Board: Demand that It Sell Is Dropped
Haven Bancorp of Westbury, N.Y., has resolved a lengthy proxy battle by naming two dissident shareholders to its board.The $2.9 billion company said Monday that it has appointed Richard Lashley and Garrett Goodbody to the board and that of its CFS Bank.
Mr. Lashley is co-founder of PL Capital Group of Chatham, N.J., an investment group that had been pressuring the thrift to find a buyer. Mr. Goodbody is managing partner of an international portfolio management firm, Goodbody Partners.
PL Capital has withdrawn its proposal that Haven sell itself and has agreed to vote for the company's board nominees at its annual stockholders meeting, slated for May 17.
Haven, which recently hired the investment bank Lehman Brothers Inc. to advise it on strategic alternatives, is also restructuring.
The company said last week said that it has sold the bulk of its residential mortgage origination division to M&T Mortgage Corp. of Buffalo and is in negotiations to sell its Fishkill, N.Y., mortgage origination office.
Haven will take a first-quarter charge of more than $7 million to cover restructuring costs, including the elimination of about 70 jobs, but said it expects to save $7 million a year from the restructuring and the expected sale of the mortgage origination office.
- Veronica Agosta
