LANSING, Mich., and PHOENIX, Oct. 8 /PRNewswire-FirstCall/ -- Capitol Bancorp Limited (NYSE: CBC) announced today that it has entered into a definitive sales agreement with investors for the sale and subsequent recapitalization of 1st Commerce Bank.
Capitol's Chairman and CEO Joseph D. Reid said, "This transaction addresses one of our key strategic initiatives by further deleveraging our consolidated balance sheet."
Jason A. Awad, a veteran Nevada businessman with deep roots in the greater Las Vegas community, has executed a definitive agreement that will acquire 100% ownership of 1st Commerce Bank. As of June 30, 2010, 1st Commerce Bank had approximately $45 million in total assets, $30 million in total loans and reported a loss of approximately $1.2 million through the first six months of 2010.
Reid added, "1st Commerce Bank, which was launched in late 2006, was almost immediately impacted by the early stages of the national recession and subsequent banking crisis, in its efforts to gain traction in its local market. And approximately one year ago an aborted divestiture transaction initiated in the summer of 2009 further impeded the bank's original growth initiatives. As Capitol continues to address challenges within its affiliate network, this transition serves as a strategic opportunity to deleverage our consolidated balance sheet while enabling 1st Commerce Bank to partner with a local, seasoned banking team possessing access to additional capital resources."
The transaction is expected to be completed by year-end 2010 or in early 2011.
About Capitol Bancorp Limited
Capitol Bancorp Limited (NYSE: CBC) is a $4.7 billion national community banking company, with a network of bank operations in 14 states. Founded in 1988, Capitol Bancorp Limited has executive offices in Lansing, Michigan and Phoenix, Arizona.
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SOURCE Capitol Bancorp Limited