Posts tagged: Sterling Financial Corp.
The downtown business beat continues producing more real estate deals.
In Friday's paper was the announcement two groups bought the side-by-side buildings formerly called the Sherwood Mall. In fact, the buildings were built in different eras, and are probably best managed as two different structures.
The smaller building is the corner building once known as the home of First National Bank. It's at the corner of Riverside and Stevens.
That building was acquired by an investors group that includes Spokane Chiefs and Spokane Indians owner Bobby Brett, and area developer Chris Batten.
Brett is general manager of 1953 Box LLC, the company owning the corner building … and the name refers to the year this building went up, in 1953. The earlier building that sat there was not two stories. We'll go hunting for the historic photo of that bank that later was torn down.
The plan is to rebrand the building as the Numerica Building, and Numerica Credit Union will take most of the main floor. The rendering here, provided by nystrom + olson archiecture, shows the exterior of the building after remodeling.
The “real” Sherwood building, at 510 W. Riverside,was purchased by an LLC called Sure Would, whose principal is Tom Clemson, the president of Inland Group.
Here's a lesson in market timing. Sterling Financial, which bought the two buildings back in the 1970s, sold them in 2007 to a North Idaho doctors' group, for $3.7 million.
This past month, Clemson's group paid $800,000 for the eight-story building, while Box 1953 LLC paid $500,000 for the corner building. Certainly both properties will take some major renovation. But those are decent deals for good downtown real estate.
In 2010 the properties were assessed at $2.7 million together.
Andrew Schultheis has been appointed executive vice president and general counsel at Sterling Financial Corp.
Schultheis, 40, has been outside counsel to Sterling, the parent of Sterling Savings Bank, while with Witherspoon Kelley.
Before joining the Spokane law firm in 2005, Schultheis practiced with a Silicon Valley(Calif.) firm representing clients such as Cisco Systems Inc. and Symantec Corp.
The graduate of Whitman College and the University of Michigan law school is also a member of the Connect Northwest and Inland Northwest Land Trust boards of directors.
New Sterling Financial Corp. Chairman Les Biller was paid $1.5 million to accept the position, and will receive a total $4.5 million by Dec. 31, 2012, unless he resigns.
Biller’s compensation was listed in a Monday filing with the U.S. Securities and Exchange Commission. The filing also disclosed the resignatiion of all but four members of the Sterling board of directors following completion Thursday of a $730 million recapitalization.
The appointment of Biller, a former vice chairman of Wells Fargo, helped attract private investors who participated in the recapitalization. According to the letter offering Biller the job, he invested between $4 million and $7 million of his own money in Sterling.
Biller succeeds William “Ike” Eisenhart, who became chairman when Sterling co-founder Harold Gilkey was forced out last October by regulators.
Eisenhart remains on the board along with other holdovers Ellen Boyer, Michael Reuling, and Greg Seibly, Sterlings chief executive officer.
Sterling Financial Corp. has completed the $730 million recapitalization plan announced last week.
The money from a mixture of institutional and individual investors will bring the parent of Sterling Savings Bank back into compliance with regulatory capital requirements, Chief Executive Officer Greg Seibly said.
Sterling reserves had been drained by substantial losses on real estate and construction loans.
“The successful completion of this capital raise helps position Sterling as a premier community banking franchise in the Pacific Northwest,” said Seibly, who added thanks to customers and employees who remained loyal while the bank solved its capital problems.
COMING SUNDAY: Just how did Sterling Financial Corp. pull off the $730 million recapitalization plan? Read Bert Caldwell’s story in our Sunday Business section.
Sterling Financial Corp. today reported a second-quarter loss of $58.2 million, including a $70.8 million allowance for credit losses.
A year ago, the Spokane bank reported a net loss of $33.9 million after a $79.7 million allowance for credit losses. Per share, the 2010 quarter loss was $1.12, compared with 65 cents for the 2009 quarter.
But Chief Executive Officer Greg Seibly said the 2Q numbers were an improvement compared with the first quarter, and there were other positive indicators for Sterling (STSA), which has been trying since last fall to raise additional capital.
Non-performing loans declined 8 percent compared with the first quarter, to $884.1 million, and loan origination increased 25 percent.
Retail deposits climbed but the total fell, to $7.2 billion, as Sterling continued to reduce its dependence on brokered deposits. The number of accounts increased.
Total assets, at $9.7 billion, have fallen 21 percent since June 30, 2009.
The U.S. Treasury has approved agreements that will inject almost $280 million in private equity investment into Sterling Financial Corp.
Warburg Pincus Private Equity X, L.P. and Thomas H. Lee Partners L.P. will each invest $139 million in Sterling, which has undertaken a $720 million recapitalization effort to meet regulator requirements.
The Treasury Department committed $303 million in Sterling under the Troubled Asset Relief Program, but has agreed to mark that investment down to $75.8 million, plus warrants to purchase stock in the future, to assist in the recapitalization.
Sterling is the Spokane-based holding company for Sterling Savings Bank and Golf Savings Bank.
A Wall Street private equity firm has agreed to invest $139 million in Sterling Financial Corp. as the Spokane bank holding company continues its recapitalization effort.
Warburg Pincus Private Equity X, L.P. would own 20.5 percent of Sterling if the company successfully completes its $720 million plan to raise enough capital to satisfy regulator requirements.
Warburg Pincus would own Sterling common and preferred stock.
Thomas H. Lee Partners, which had earlier announced a $170 million investment in Sterling, would roll that amount back to the equivalent of the Warburg Pincus investment.
Both investments, and participation by the U.S. Treasury, are subject to completion of the recapitalization plan, regulatory approvals, stabilization of Sterling assets and capital levels, and other conditions.
Sterling Financial Corp. today announced the appointment of a former Wells Fargo & Co. executive as chairman of the board.
The appintment of Leslie “Les” S. Biller must be approved by Sterling regulators, and is subject to completion of its $720 million recapitalization effort.
Biller is the chief executive officer of Greendale Capital, a private investment and consulting company. Before founding Greendale in 2002, he was the executive vice president and chief operating officer at Wells Fargo.
He had been president of COO of Norwest Corp. when it merged with Wells Fargo in 1998, and also held executive positions at Bank of America and Citicorp.
Biller, a Los Angeles resident, has a bachelor’s degree in chemical engineering degree from City College of New York and a master’s in business administration from Xavier University.
Sterling Financial Corp. today announced new investments that could fulfill the Spokane institution’s need for additional capital.
Thomas H. Lee Partners, which last week committed $134 million to the recapitalization effort, will increase its investment to $170 million.
Sterling said it will also offer, in a private placement, $555 million in common and convertible preferred shares to accredited private investors.
If that offering is successful – a spokeswoman said she could not comment on whether there were buyers for the new stock – the combined investment of $725 million would bring Sterling and its principal subsidiary, Sterling Savings Bank, into compliance with regulatory capital requirements.
The U.S. Treasury will accept a steep markdown of its investment in Sterling Financial Corp. as part of a recapitalization plan, the Spokane company announced today.
The markdown was a condition imposed by Thomas H. Lee Partners, which has committed $134.7 million to Sterling’s recapitalization.
Treasury in November 2008 invested $303 million from the Troubled Asset Relief Program in Sterling.
According to the terms of the agreement with Sterling and Lee, Treasury will get $75.8 million worth of common shares as payback, plus 6.4 million warrants to purchase shares at 20 cents apiece.
The warrants will be good for 10 years.
Sterling must raise a total $720 million in new capital to offset losses on its real estate and construction loans.
A Boston private equity firm will invest $134.7 million in struggling Sterling Financial Corp. as part of the Spokane company’s ongoing efforts to raise enough money to meet requirements imposed by federal regulators.
As part of that recapitalization effort, Sterling also said it entered into an exchange deal with the U.S. Treasury that will convert about $303 million in preferred shares held by Treasury to common stock worth about $75 million, the company said in a news release.
The two deals were described as linked, with the Treasury deal depending on Sterling signing the deal that will raise the $134.7 million from Thomas H. Lee Partners, L.P.
Company executives have said in the past that it’s rare for Treasury to accept such a steep discount on its investments, made as part of the Troubled Asset Relief Program.
Hoovers describes Thomas H. Lee as a “friendly leveraged buy-out company” that prefers to work with distressed companies to improve shareholder value.
Shares of Sterling Financial Corp. climbed more than 65 percent Friday on trading volume 15 times normal.
The stock, which closed at 87 cents Thursday, finished the Friday trading day at $1.45, and advanced another seven cents in after-hours trading.
The 16.2 million shares traded represent almost one-third of the 52 million Sterling shares outstanding.
Sterling spokeswoman Cara Coon said the company would not comment on the trading activity.
Banking regulators have ordered Sterling to raise $650 million in additional capital to help reinforce a balance sheet shredded by heavy losses in contruction and real estate loans.
That effort is progressing, Coon said.
In a separate development, Sterling was ranked first among Northwest banks for customer satisfaction in a survey of 1,903 consumers by J.D. Power and Associates.
Sterling Financial Corp. has implemented a shareholder rights plan to protect tax assets accumulated as it reported substantial operating and capital losses in recent quarters. The assets, $269 million, can be used to offset an equal amount of future profits. But, said Vice President Dave Brukardt, their value could be lost or diminished if non-institutional investors that each own five percent of Sterling common stock build their collective position by more than 50 percent within three years. Unlike most rights plans, Sterling’s is not intended to be a defense against a hostile takeover, he said. Brukardt said the rights plan was adopted as part or Sterling’s ongoing recapitalization plan, which calls for $650 million in new financing. Sterling has suffered severe losses on loans backing real estate development in the Northwest and California.
Sterling Financial Corp. has implemented a shareholder rights plan to protect tax assets accumulated as it reported substantial operating and capital losses in recent quarters.
The assets, $269 million, can be used to offset an equal amount of future profits. But, said Vice President Dave Brukardt, their value could be lost or diminished if non-institutional investors that each own five percent of Sterling common stock build their collective position by more than 50 percent within three years.
Unlike most rights plans, Sterling’s is not intended to be a defense against a hostile takeover, he said.
Brukardt said the rights plan was adopted as part or Sterling’s ongoing recapitalization plan, which calls for $650 million in new financing.
Sterling has suffered severe losses on loans backing real estate development in the Northwest and California.
Sterling Financial Corp. has extended the expiration date for its effort to buy back $238 million in trust-preferred securities.
The deadline was today. April 12 is the new date.
The Spokane-based parent of Sterling Savings Bank and Golf Savings Bank is offering 20 cents on the dollar for the securities. Investor response will be critical to the company’s $650 million recapitalization plan, which is being closely monitored by federal and state regulators.