Capital Bank Financial

Capital Bank Financial Corp., (NASDAQ:CBF), (previously called North American Financial Holdings Inc., or NAFH) is a bank holding company headquartered in Coral Gables, Florida[1] with $7 billion in assets as of March 31, 2015.[2] Former Bank of America vice chairman Gene Taylor is chief executive, former Bank of America executive and Fifth Third Bank CFO, Chris Marshall is CFO and former Bank of America executive, R. Bruce Singletary is Chief Risk Officer. Former Morgan Stanley research analyst, Kenneth Posner, manages research. Its original purpose was to take over banks that had difficulties due to the financial crisis of 2007–2010, making money by paying low prices and then improving the banks' performance. The company's main interest was banks in the Carolinas and Florida, but in 2011, NAFH moved into Tennessee and Virginia for the first time. Despite buying seven distressed, money losing banks, Capital Bank has been profitable since inception and has consistently posted improved returns for each of its five years of operations. Capital Bank completed a successful IPO in September of 2012 and now trades on the NASDAQ under the ticker CBF. Capital Banks stock has done well since its debut, outperforming most bank indexes over the past few years.

History

North American Financial Holdings

In December 2009, NAFH raised $900 million from such sources as private equity firms Crestview Partners, Oak Hill Advisors and Falfurrias Capital Partners. In March 2010 the OCC granted NAFH a national bank charter, and the search began for banks to acquire.[3]

On June 29, 2010, Naples, Florida-based TIB Financial Corp., parent of TIB Bank and Naples Capital Advisors, announced that NAFH had agreed to invest $175 million in the company. Over the next 18 months, NAFH would have the right to invest $175 million more. The deal was completed in third quarter 2010.[4][5]

As of July 16, 2010, NAFH owned MetroBank of Dade County, Florida; Turnberry Bank of Aventura, Florida; and First National Bank of the South in Spartanburg, South Carolina. These four banks, after approval of the TIB deal, give NAFH $3.1 billion in assets,[3] and 10 branches in the Miami, Florida area and 13 in South Carolina, plus 28 more branches in southwest Florida with the completion of the TIB deal.[6] NAFH did not pay for the three banks it already owns, but instead divided loan losses with the Federal Deposit Insurance Corporation.

Hugh McColl, co-founder of Falfurrias and former Bank of America CEO, predicted NAFH would have $20 billion in assets in five to seven years.[3]

As of March 31, 2010, MetroBank had $442.3 million in assets with $391.3 million in deposits. Turnberry Bank had $263.9 million in assets with $196.9 million in deposits. First National had $682.0 million in assets and deposits totalling $610.1 million.[6]

Capital Bank

On December 16, 2010, shareholders of Raleigh, North Carolina-based Capital Bank approved selling a majority interest to NAFH, which would buy newly issued stock rather than stock from existing shareholders.[7] Capital Bank began in 1997 as the Triangle's first new bank in eight years, after raising $26 million, the most for a new bank in the state's history.[8] By 2005, after expansion and buying other banks, Capital had $915 million in assets,[9] and by 2010, assets had reached $1.7 billion.[10] The Late-2000s recession hurt Capital, and regulators expected the bank to act. At one time, selling new stock was considered. Finally, Capital chose to accept help from NAFH.[11] The deal originally depended on NAFH being able to get a 50 percent discount on preferred stock and warrants held by the U.S. Treasury as a result of the federal stimulus.[7] However, in a January 18, 2011 interview, Capital CEO Grant Yarber said the federal government would get all its money back.[12]

On January 28, 2011, NAFH completed its $181 million deal for 85 percent of Capital. NAFH CEO Gene Taylor became CEO of Capital, replacing Yarber, whose new title was market president for North Carolina.[13]

All NAFH-owned banks continued to operate separately but the company announced its intention to re-brand the banks as Capital Bank.[14] Capital had 32 branches before the deal, but after adding the four other NAFH banks, the total was 84. Capital kept its Raleigh headquarters.[12] When the deal was closed, North American's banks had more than $5 billion in assets, placing them among the nations top 125 banks.

Late in April 2011, NAFH applied to the Comptroller of the Currency for a merger of all of the banks into NAFH National Bank, a nationally chartered bank which operates as Capital Bank, National Association. The Capital Bank headquarters then relocated from Raleigh's Capital Bank Plaza, where it moved in 2006, to Miami, Florida. Raleigh would still have such operations as technology and loan processing at what CFO Christopher Marshall described as the "working headquarters". The headquarters change put Capital in the Federal Reserve Bank's Atlanta, Georgia territory, though this made the merger easier because as a Florida-based company, NAFH was already under Atlanta's jurisdiction. A Raleigh headquarters would have put the bank under Richmond, Virginia, which would have required the same changes as a move.[15][16]

On May 5, 2011, NAFH announced a $217 million deal for 90 percent of Greeneville, Tennessee-based Green Bankshares Inc., with 65 GreenBank branches and $2.5 billion in assets. GreenBank CEO Steve Rownd would be Tennessee market president.[14] With the completion of this transaction in the third quarter, NAFH had $7.1 billion in assets (putting the company in the nation's top 100 banks), $5.4 billion in deposits, and 146 branches in five states.[17][14] NAFH also bought the remainder of TIB and Capital.[17]

In June 2011, NAFH filed with the SEC to raise up to $300 million in an initial public offering. Because the market was not doing well, NAFH postponed the IPO until 2012, after the holding company had changed its name to Capital Bank Financial Corp.[18]

In a news release dated March 27, 2012, Capital Bank Financial Corp. said it agreed to buy Southern Community Financial Corp. of Winston-Salem, North Carolina, whose Southern Community Bank and Trust had $1.5 billion in assets and 22 branches, for $2.88 a share. Southern Community, started in 1996, was Winston-Salem's third-largest bank by deposits. The completion of the deal was expected to give Capital Bank Financial $8.1 billion in assets and 165 branches.[19]

On November 23, 2015, Capital Bank said it would buy CommunityOne Bank, with $2.4 billion in assets and 45 branches and based in Charlotte, North Carolina, in a deal worth $350 million.[20]

References

  1. ↑ "About Capital Bank". Retrieved 2014-04-28.
  2. ↑ Craver, Richard (June 8, 2014). "NewBridge prepares to cross state lines". Winston-Salem Journal. Retrieved June 8, 2014.
  3. 1 2 3 Rothacker, Rick (2010-07-23). "New firm takes over 3 banks in a weekend". The Charlotte Observer. Retrieved 2010-07-27.
  4. ↑ "TIB Financial Corp. Announces Federal Reserve Approval of North American Financial Holdings, Inc. Investment". MSNBC. Globe Newswire. 2010-09-17. Retrieved 2012-05-03.
  5. ↑ "TIB Financial Corp. Announces Closing of $175 Million Investment From North American Financial Holdings, Inc.". MSNBC. Globe Newswire. 2010-10-01. Retrieved 2012-05-03.
  6. 1 2 "North American Financial Holdings, Inc. Acquires Three Failed Banks from the FDIC". PRNewswire. 2010-07-16. Retrieved 2010-07-27.
  7. 1 2 Ranii, David (2010-12-16). "Capital Bank shareholders approve deal". News & Observer. Retrieved 2010-12-16.
  8. ↑ Joel B. Obermayer, "Capital Bank lives up to name," News & Observer June 24, 1997.
  9. ↑ Frank Norton, "Bank plans to move downtown," News & Observer, November 2, 2005.
  10. ↑ "Capital Bank Announces Financial Results for First Quarter of 2010". PRNewsire. 2010-04-27. Retrieved 2011-02-09.
  11. ↑ David Ranii, "Capital Bank merger outlined," News & Observer, November 6, 2010.
  12. 1 2 Ranii, David (2011-01-19). "Capital Bank to repay bailout". News & Observer. Retrieved 2011-01-24.
  13. ↑ Ranii, David (2011-02-01). "Capital Bank reports loss". News & Observer. Retrieved 2011-02-05.
  14. 1 2 3 Rothacker, Rick (2011-05-06). "N.C.-based North American plans to add a Tennessee bank". The Charlotte Observer. Retrieved 2011-05-06.
  15. ↑ Ranii, David (2011-04-30). "Capital Bank merger approved by regulators". News & Observer. Retrieved 2011-05-21.
  16. ↑ Lee Weisbecker (29 April 2011). "Capital Bank headquarters going to Miami". Triangle Business Journal. Retrieved 28 April 2012.
  17. 1 2 Brian Bandell (8 September 2011). "North American Financial gets control of Green Bank". South Florida Business Journal. Retrieved 28 April 2012.
  18. ↑ Adam O'Daniel (26 April 2012). "Capital Bank files new IPO documents, will issue shares". Charlotte Business Journal. Retrieved 28 April 2012.
  19. ↑ Kirsten Valle Pittman (27 March 2012). "Capital Bank buys Winston-Salem’s Southern Community Bank and Trust". Charlotte Observer. Retrieved 28 April 2012.
  20. ↑ "Florida bank acquires Asheboro's CommunityOne Bank". News & Record. 23 November 2015. Retrieved 23 November 2015.

External links

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