Plan would leave AmericanWest Bank privately held
AmericanWest Bank will become a privately held company under a recapitalization plan announced today by its holding company, Spokane-based AmericanWest Bancorporation.
The move was prompted by orders from regulators to reinforce its capital base. AmericanWest Bancorporation President and CEO Pat Rusnak has said the bank, headquartered at 41 W. Riverside Ave., needs about $125 million.
AmericanWest has a sizable, 58-branch footprint that extends from Spokane and Eastern Washington through Idaho to southern Utah. Total deposits were $1.45 billion as of Sept. 30.
AmericanWest said it will sell to SKBHC Holdings LLC, a private investor led by banking professionals, and an affiliated entity that signed a purchase agreement to acquire all the bank’s common stock for $6.5 million in cash, subject to a competitive bidding process.
If SKBHC is the successful bidder, the agreement calls for it to recapitalize AmericanWest Bank with additional capital of up to $200 million to satisfy capital requirements imposed by federal and state regulators.
AmericanWest Bancorporation will file for Chapter 11 bankruptcy to facilitate the transaction, and the bankruptcy court will supervise a competitive bidding process for the bank’s common stock. The filing would affect only the holding company and would exclude AmericanWest Bank and its Far West Bank division, which operate separately. AmericanWest Bank operates under the name of Far West Bank in Utah.
“This transaction will give AmericanWest Bank and Far West Bank the capital to become ‘well-capitalized’ and to meet the capital requirements defined by the Bank’s regulators – without any financial assistance from the government or taxpayers,” Rusnak stated in a news release. “We are pleased to have found a partner with extensive banking experience and a strong interest in enabling AmericanWest Bank to grow as a viable competitor that serves thousands of individuals and businesses in our communities.”
In August Rusnak said AmericanWest used the past year to aggressively address its problem loans while maintaining deposits and liquidity. The FDIC, Washington Department of Financial Institutions, and other overseers have been kept constantly informed on the bank’s progress, he said.