With Bankruptcy, United Western Buys Time in Bid to Regain Thrift
Barba, Robert, American Banker
Byline: Robert Barba
United Western Bancorp Inc. in Denver has filed for chapter 11 bankruptcy in a move that would allow the company more time to pursue its lawsuit against federal regulators for seizing its thrift in January 2011.
On Monday, the company said in a press release that it filed for relief in United States Bankruptcy Court for the District of Colorado. The restructuring is hinged on the company getting support from the creditors and equity holders and attracting additional capital as it pursues its litigation to regain control of the operations, assets and liabilities of United Western Bank, the $2 billion-asset failed thrift.
The company's executives, acting on behalf of the failed thrift, sued the Office of Thrift Supervision in February 2011 in the United States District Court for the District of Columbia, claiming the regulators acted in an arbitrary and capricious manner in seizing the thrift, particularly because the company had capital committed from new investors. The Office of the Comptroller of the Currency took over as defendant in July, following the merger of the OTS into the OCC.
The executives and the OCC have been battling over the release of correspondence between the OTS and the Federal Deposit Insurance Corp. …