Seacoast Banking Corp. of Florida has gotten current on dividends tied to the Troubled Asset Relief Program after missing nine payments to the Treasury Department.
The Stuart, Fla., company paid $6.6 million to the Treasury, which included payment for the current month. Seacoast also said on Wednesday that it had paid accrued and unpaid interest of about $2.5 million to holders of its trust-preferred securities.
Denny Hudson, the $2.1 billion-asset company's chairman and chief executive, said in an interview that Seacoast's ability to finally make the payments was due to a "dramatic improvement in credit risk and a return to profitability."
Seacoast still holds the $50 million it received from the Treasury as part of Tarp. The company has not disclosed a timeline for exiting the program, but "clearly there will come a time when we will want to pay Tarp," Hudson said.
He said that factors dictating when Tarp will be repaid include a significant improvement in the local economy and a "much improved level of profitability."
Seacoast recorded a $1.11 million profit in the second quarter profit, a signficant reversal from the $13.8 million loss of a year earlier. Nonperforming assets fell 34.4% from a year earlier, to $72 million, or 3.46% of total assets.
Playing catch up is not an easy task, though at least one other bank has pulled it off. Peninsula Bank Holding Co., since renamed Avidbank Holdings Inc., was four payments behind in July 2010 before catching up earlier this year.
An Aug. 11 research report compiled by KBW Inc.'s Keefe, Bruyette & Woods found that at least 90 banks have missed at least four Tarp dividend payments. The payments are made quarterly, so four missed payments equates to a year's worth of missed payments.
In April 2010, Seacoast raised $50 million from private equity funds, including CapGen Capital Group. The company made an unsuccessful bid in later that month to acquire Riverside National Bank of Ft. Pierce, Fla.