Coast Bancorp Announces Capital Raise
June 12 2014 - 4:56PM
Marketwired
Coast Bancorp Announces Capital Raise
SAN LUIS OBISPO, CA--(Marketwired - Jun 12, 2014) - Coast
Bancorp ("the Company") (OTCBB: CTBP), parent company for Coast
National Bank, announced today the successful completion of a
Private Placement of $6.8 million of debt and equity capital
consisting of 4,800,000 in common stock of Coast Bancorp at $1.00
per share and $2,000,000 of Private Lender Senior Notes. The
offering was primarily to accredited investors. The $6.8
million offering successfully provides the cash required to meet
the obligations of the Company and provide for future growth. FIG
Partners, LLC acted as sole placement agent for this offering.
Use of proceeds of the offering will be to bring current the
Company's accrued interest on its subordinate debt, which is known
as Trust Preferred (TRUPS), augment capital at its subsidiary,
Coast National Bank, and other general corporate
purposes.
Concurrent with this transaction the Company adopted a Tax
Benefits Preservation Plan, designed to protect the significant
benefit of the Company's Deferred Tax Asset for the benefit of all
shareholders. This plan creates a positive benefit for legacy
and new investors and enhanced the value of their investment. The
potential recapture of the Deferred Tax Asset, in combination with
the offering of common stock, is substantially accretive to the
book value of existing shareholders.
Anita Robinson, President and CEO of both the Company and Coast
National Bank, stated, "Coast National Bank entered into a Consent
Order with the Office of the Comptroller of the Currency in
February 2011, which was terminated in April of 2014 as a result of
the diligent efforts of the board, management and employees. Once
the credit quality issues were significantly improved, the focus
then shifted to operational efficiencies and profitability. The
bank is now poised to grow and take advantage of changes in the
local banking market as one of the few remaining community banks in
San Luis Obispo County." Robinson added, "This was a home run
for our shareholders. Their book value per share at December 31,
2013 was ($1.02) and on a pro forma basis will increase to $0.60
per share, even before the value in our deferred tax asset has been
preserved."
"The new Coast National Bank emerges with a fresh perspective on
what it takes to be a successful community bank. The
commitment to our community never faltered and remains as steadfast
as ever. We are looking forward to implementing our strategies
to build out the bank and service our community. The focus
will be to continue to grow our small business lending, which has
always been one of our best attributes. As the bank emerges
from the storm, it is revitalized and excited about the
future."
Established in 1997, Coast National Bank is a local community
bank serving the banking needs of consumers and businesses through
four local offices serving San Luis Obispo County. With a focus on
delivering outstanding customer service, Coast National Bank is an
expert in small business lending, as preferred lender with the SBA,
and provides an array of business and personal banking deposit
products and other services. For further information, visit
www.coastnationalbank.com or call 805.541.0400.
Coast National Bank is an Equal
Housing Lender and member FDIC.
This release may contain certain forward-looking statements
that are based on management's current expectations regarding
economic, legislative, and regulatory issues that may impact the
Company's earnings and operations in future periods.
Forward-looking statements can be identified by the fact that they
do not relate strictly to historical or current facts. They often
include the words "believe," "expect," "intend," "estimate" or
words of similar meaning, or future or conditional verbs such as
"will," "would," "should," "could" or "may." Factors that could
cause future results to vary materially from current management
expectations include, but are not limited to, the ability of
management to successfully utilize the capital raised in the recent
offering, general economic conditions, economic uncertainty in the
United States and abroad, changes in interest rates, deposit flows,
real estate values, competition, changes in accounting principles,
policies or guidelines, legislation or regulation, and other
economic, competitive, governmental, regulatory and technological
factors affecting the Company's operations, pricing, products and
services. The Company undertakes no obligation to release publicly
the result of any revisions to these forward-looking statements
that may be made to reflect events or circumstances after the date
of this press release or to reflect the occurrence of unanticipated
events.