Magazine article American Banker

U.S Century in Florida to Receive $140 Million from Local Investors

Magazine article American Banker

U.S Century in Florida to Receive $140 Million from Local Investors

Article excerpt

Byline: Chris Cumming

U.S. Century has agreed to a deal with Miami investors that would clean up its loan portfolio and provide much-needed capital, while keeping the bank under local, independent management.

The Doral, Fla., bank said Tuesday that it has signed a letter of intent with a group of investors led by real estate developers James Tate of Tate Capital and Sergio Rok of Rok Enterprises, under which the group would invest $50 million in the bank and pay up to $90 million for its soured loans.

The $1 billion-asset bank had $98 million in nonaccrual loans as of Dec. 31, 2012, according to the Federal Deposit Insurance Corp. The bank lost more than $8 million through the first nine months of 2012 and lost more than $79 million in 2011.

Under the deal, the group of investors would gain control of U.S. Century's board, Tate said, but it intends to leave president and chief executive, Carlos Davila, in place. The group has been impressed with the systems and controls that Davila has put in place, since becoming president in August, Tate said.

The group will also give existing shareholders the opportunity to re-invest in the bank, Tate said.

"There are two goals here. One is to recapitalize the bank and leave it with a clean book of loans so that it can again be profitable. And the other is to create a strong South Florida community bank under local management that mirrors the demographics of the market it serves," said Tate.

This proposed deal would mark the end of U.S. Century's efforts to raise capital or find a merger partner. C1 Bank agreed to buy U.S. Century in August, but the banks called the merger off late last year due to difficulties negotiating U.S Century's exit from the Troubled Asset Relief Program. The Treasury Department rejected C1's proposal to buy back the $50. …

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