Park National gets $20 million after resolving issue from 2007 acquisition
Park National in Newark, Ohio, has resolved a longstanding issue tied to a 2007 acquisition.
The $9.2 billion-asset company said in a regulatory filing Wednesday that it had received a $20 million settlement tied to unpaid judgments associated with former Vision Bank nonperforming loans. Park had previously charged the loans off.
The settlement should boost Park’s pretax net income by $18 million after taking into account estimated expenses.
Park bought Vision Bank to expand into what had been the fast-growing Gulf Coast markets of Florida and Alabama, but the deal quickly soured because of nonperforming loans. Regulators flagged the Vision Bank unit in 2011 for underfunding its loan-loss allowance because of its accounting treatment of guarantor support loans.
Park eventually sold 17 Vision Bank branches to Home BancShares Inc. in Conway, Ark.
Park agreed in 2016 to pay $500,000 to settle Securities and Exchange Commission allegations that its loan-loss accounting underplayed credit problems at Vision Bank.
Christopher Marinac, an analyst at Janney Montgomery Scott, said in a client note Thursday that the settlement should increase Park’s tangible book value by 87 cents a share.