BancTrust seeks investors, not buyersPublished 8:55pm Saturday, February 18, 2012
A December filing with the Securities and Exchange Commission caused some to speculate that BancTrust Financial Group — the holding company for BankTrust — might be sold.
Some media reports last week said efforts by the bank to find investors, gain new capital and improve its balance sheet are being done to improve its image to potential buyers. Bibb Lamar, chairman and CEO of BancTrust, told the Times-Journal last week that the bank simply was seeking additional investors and not seeking to sell.
As his company moves into multiple floors of a refurbished downtown Mobile office building Lamar remains puzzled as to how what he considers routine filings with the SEC led some to think the bank is for sale.
BankTrust operates community banks in Selma, Greenville, Demopolis, Eufaula, among others in Alabama and Florida.
The capital the bank is seeking to raise, Lamar said, will improve its balance sheet as to:
- old non-performing real estate loans in Florida.
- clearing up the bank’s commitment to the Troubled Assets Relief Program (TARP).
- remaining obligations in the bank’s purchase of Selma-based People’s Bank & Trust Company.
Dr. John Jahera Jr., co-editor of the Journal of Financial Economic Policy and professor with Auburn University’s College of Business, said the effort by BancTrust to seek capital investors is normal.
“Banks are always in the process of seeking capital infusions to strengthen their positions for expansion, growth opportunities, perhaps to meet additional regulatory requirements. There are a whole host of reasons that could lead to seeking additional capital,” Jahera said. As for the speculation that the bank could be positioning itself to sell, Jahera did not know of any takeover attempts or sale opportunities, but said the past 20 years have seen tremendous activity in banks being consolidated.
“We’ve seen a lot of bank consolidation, really in the past 20 years since the Riegle-Neal Interstate Banking legislation passed in 1994. Today we have nearly half the banks in the country because of the consolidation; much bigger banks, but fewer banks,” Jahera said. “Any bank is a potential takeover target or an acquirable target.
Certainly getting out from any of their TARP requirements would make them more attractive, but without any knowledge of any specific takeover event, I would think it’s pure speculation at this stage.”