Equity looks to bid on Overland Park bank’s preferred stock
03/29/2013 5:13 PM
03/29/2013 5:13 PM
Equity Bancshares, the Wichita-based holding company of Equity Bank, said Friday that it wants to bid on the preferred stock of Blue Valley Ban Corp that is held by the Treasury.
Brad Elliott, Equity’s chairman and CEO, said his company made application with the Kansas City Federal Reserve Bank this week to bid in an auction of those preferred shares when Treasury schedules one.
Elliott said if his company is successful, it would own 60 percent of the holding company that owns the Bank of Blue Valley, which is based in Overland Park.
“We’re just looking at bidding on it,” Elliott said. “It’s a good investment for us.”
He said his bank approached Blue Valley about an acquisition and was told the bank was not for sale.
“I would confirm everything Brad said,” said Bob Regnier, Blue Valley’s president and chairman. “The bank isn’t for sale.”
Regnier said the bank has every intention of repaying the investment it received from the Treasury’s Capital Purchase Program, which was part of the Troubled Assets Relief Program, aimed at temporarily boosting banks’ capital following the financial crisis of 2008.
He said Blue Valley, like a lot of banks, has “gone through a rough patch, frankly” but is “coming out of this.”
“I plan on paying it back,” Regnier said. “It’s in the way of my common shareholders getting a return” on their investment.
He said he understands that Treasury does plan on auctioning the preferred stock it holds in Blue Valley.
But the winning bidder, Regnier and Blue Valley chief financial officer Mark Fortino said, will not end up with control of Blue Valley bank.
“The TARP represents about 50 percent of our holding company equity,” Regnier said. “It’s about 30 percent of our bank equity.”
“We pay it back, they go away, and there’s no common stock ownership,” he said.
Blue Valley received $21.75 million in CPP capital in December 2008 and has made more than $211,000 in dividend payments, according to Treasury data.
Equity Bank, based in Andover, operates eight branches in metro Kansas City. Blue Valley operates five branches in the metro.