|By Marketwired .||
|June 12, 2014 04:56 PM EDT||
SAN LUIS OBISPO, CA -- (Marketwired) -- 06/12/14 -- 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.