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3 companies miss November TARP dividend payment


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Banking Essentials Newsletter: September Edition

3 companies miss November TARP dividend payment

Three banking institutions missed the November quarterly Troubled Asset Relief Program dividend payment as required under the Capital Purchase Program, according to a Dec. 11 report from the U.S. Treasury. By comparison, four companies missed the August dividend payment.

On Sept. 7, the Treasury exchanged its preferred stock in Granby, Colo.-based Grand Mountain Bancshares Inc. for common stock, which was immediately sold off. Previously, the bank had missed 33 dividend payments and accrued $1.7 million in noncurrent dividends.

The Treasury also completed the exchange of Elkton, Md.-based Cecil Bancorp Inc.'s preferred stock for common stock on Oct. 26, pursuant to a confirmation order from the U.S. Bankruptcy Court for the District of Maryland. As part of the exchange, the common stock was immediately sold off and the Treasury's warrant was cancelled. Cecil Bancorp filed for Chapter 11 bankruptcy on June 30.

Among the six companies remaining in the CPP, the Treasury holds preferred stock stakes in four companies, a subordinated debt stake in one company and has converted its preferred stock into common equity in Los Angeles-based Broadway Financial Corp., which is not required to make quarterly dividend payments on common stock held by the Treasury.

St. Louis-based St. Johns Bancshares Inc. was the only company that paid its November preferred stock dividend.

In aggregate, the four companies that missed dividend or interest payments in November have $24.6 million in noncurrent payments, including $5.8 million in cumulative dividends, $7.1 million in noncumulative dividends and $11.7 million in accrued interest. The Treasury has received $12.13 billion in dividend and interest payments on securities issued under the CPP, as of Nov. 30.

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Click here to download a customizable Excel file containing additional details on TARP dividend and interest deferrals.

TARP-related details for banks are disclosed in company filings and Treasury reports. These details can be accessed under the "U.S. government program participation" section of a company's briefing book page on the MI website or in MI Office. You can also access information on U.S. financial stability programs from the Industries section of MI website.