The bankrupt owner of a Las Vegas Valley community bank has reached a deal to sell the struggling lender.
Capitol Bancorp said in court filings today that it plans to sell Bank of Las Vegas — along with Indiana Community Bank, Michigan Commerce Bank and Sunrise Bank of Albuquerque — for $4.5 million to Talmer Bancorp, a holding company based in Troy, Mich.
The deal, subject to court and regulatory approval, calls for Talmer to inject up to $90 million of capital into the four banks, as well.
"We are pleased to provide the banks with a strategic partner that has the resources and capital to support the banks' long-term success,” Capitol Chairman and CEO Joseph D. Reid said in a news release.
Talmer President and CEO David T. Provost did not immediately return a call tonight seeking comment.
Capitol, a holding company based in Lansing, Mich., filed for Chapter 11 bankruptcy protection last summer. At the time, the company said it would seek quick approval from the court for a pre-packaged reorganization plan, and that the Chapter 11 filing would not affect its banks’ operations or deposits.
Still, the company, which remains in bankruptcy court, has lost several banks to forced closures this year, including 1st Commerce Bank in North Las Vegas.
The Federal Deposit Insurance Corp. closed the small, single-branch lender in June and sold its deposits and almost all of its assets to Plaza Bank. It was Southern Nevada’s first bank failure in two years.
Bank of Las Vegas, meanwhile, has been struggling for years. Its last annual profit came in 2008 — just $44,000, down from $608,000 in 2007 — and as the economy worsened, clients increasingly fell behind on their loan payments.
At the end of 2008, borrowers were late on roughly 7 percent of the bank’s loan portfolio. As of June 30 this year, they were behind on 14 percent of its loans, according to FDIC data.