For the second straight week, a private-equity group made a splash in the failed-bank arena.
North American Financial Holdings Inc., a group formed in December by former Bank of America Corp. Vice Chairman Eugene Taylor, sealed deals to buy three failed institutions in the Southeast late Friday.
The three banks bought by the newly chartered NAFH National Bank in Miami were among a total of six banks closed by the government Friday. The failed banks, which brought the year's total to 96, had combined assets of $2 billion and were estimated to cost the Deposit Insurance Fund $334 million.
NAFH, which last month completed a deal to recapitalize a struggling Florida holding company but had yet to pick up a failed bank, acquired the $682 million-asset First National Bank of the South in Spartanburg, S.C.; the $442 million-asset Metro Bank of Dade Country in Miami; and the $264 million-asset Turnberry Bank in Aventura, Fla.
Regulators also closed the $376 million-asset Woodlands Bank in Bluffton, S.C.; the $169 million-asset Olde Cypress Community Bank in Clewiston, Fla.; and the $97 million Mainstreet Savings Bank FSB in Hastings, Mich.
Despite a small number of private-equity deals relative to the sector's large interest in failed banks, NAFH's deals comes on the heels of a successful bid July 9 by Hovde Acquisition, a Washington-based private-equity firm, to acquire the failed $282 million-asset Bay National Bank in Baltimore.
Like in Hovde Acquisition's case, Taylor's group, which is based in Charlotte, used a shelf charter it received in March to execute the three deals.
NAFH, which in June announced that it would invest $175 million to take a 99% ownership stake in the struggling TIB Financial Corp. in Naples, Fla., agreed to assume all of the deposits — without paying a premium — and acquire virtually all of the assets of the three failed institutions Friday. The TIB deal is expected to close in the third quarter.
The acquisitions will give NAFH National Bank 23 branches, which will all reopen at their regular business hours. The acquirer agreed to assume $391 in deposits from Metro Bank of Dade County, $197 million in deposits from Turnberry Bank and $610 million from First National Bank of the South.
NAFH will share losses with the Federal Deposit Insurance Corp. in all three deals. The loss-sharing agreements cover $299 million from Metro Bank of Dade County, $195 million from Turnberry and $512 million from First National Bank of the South. The failures were estimated to cost the FDIC $68 million, $34 million and $75 million, respectively.
Meanwhile, Woodlands Bank was sold to Bank of the Ozarks in Little Rock. The FDIC said the acquirer had agreed to assume Woodlands' $355 million in deposits and purchase virtually all of its assets. The agency and Bank of the Ozarks will share losses on about $289 million of the failed thrift's assets. That failure was estimated to cost the FDIC $115 million.
The FDIC sold all $162 million of the deposits held by Olde Cypress to CenterState Bank of Florida in Winter Haven, which also agreed to acquire essentially all of the failed bank's assets. The FDIC and CenterState will share losses on about $128 million of those assets. The failure was estimated to cost $31 million.
Commercial Bank in Alma, Mich., will assume Mainstreet's $64 million of deposits and acquire virtually all of the failed bank's assets, while sharing losses with the FDIC on $77 million of those assets. The failure was estimated to cost the government $11 million.