Bradenton's Coast Bank still burns its buyer
Despite the best intentions, stronger banks that have recently bought up weaker banks frequently find the acquisitions continue to give them major indigestion. Consider the fate of First Banks of St. Louis, which in the fall of 2007 swooped into Florida and bought the heavily damaged Coast Bank of Bradenton.
Coast Bank, you may recall, had gotten mired after it disclosed more than $70-million worth of troubled loans to customers of bankrupt St. Petersburg builder Construction Compliance Inc. (CCI). Here's a longer history about how Coast Bank collapsed.
Now comes First Banks which, thanks to Coast Bank and other acquisitions in California, is starting to bleed red ink. First Banks also operated a mortgage affiliate that did business on Florida's west coast; it, too, has taken a financial hit. The chairman of the bank, Jim Dierberg, has thrown $100-million more of family money into First Bank. And the banking company asked for, and received, $295-million more in funds from the federal government TARP fund. Those details and more are explained in a Sunday story in the St. Louis Post-Dispatch.
(Photo shows construction debris in 2007 next to a CCI home in North Port, south of Sarasota, that sits near completion, surrounded by overgrown lots all purchased from CCI. Photo by Melisa Followell, courtesy of the Bradenton Herald.)
-- Robert Trigaux, Times Business Columnist