The countdown to the $2.75 million sale of Forrest City Financial Corp. is nearing zero.
The purchase by Cross County Bancshares Inc. of Wynne should close in October when the final regulatory approvals are expected, according to David Dowd, president and CEO of CCBI.
Forrest City Financial is the holding company of the $53.3 million-asset Forrest City Bank, which operates with a staff of 13 at two locations in its namesake hometown.
The St. Francis County lender recorded a $53,000 loss through the first six months of this year. Total equity capital at June 30 was $4.8 million.
The transaction is divided between $1.5 million cash and a $1.25 million loan from several CCBI directors.
The five biggest shareholders in Forrest City Financial and their payouts are:
- Cede & Co. of New York, a 53 percent stake worth nearly $1.5 million.
- John Stipe, former chairman, president and CEO of FCF, an 18 percent stake worth $517,140.
- Tontine Financial Partners Ltd., New York, an 8 percent stake worth $274,770.
- Lance Gad of Fairfield, Connecticut, a 6 percent stake worth $171,480.
- P. Oppenheimer Investment Part-nership of New York, a 5 percent stake worth $138,285.
Forrest City Bank was founded as Forrest City Savings & Loan Association
in 1919. The S&L was renamed Forrest City Bank when it was converted to a federal savings bank in 1995. It was rechartered as a commercial bank in 1997.
The venture had a short run as a public company that began on July 28, 1994, when it converted from a federally chartered mutual savings and loan association to a federally chartered stock association.
The transformation was part of a mutual-to-stock conversion wave that saw similar action by other Arkansas thrifts.
Participants included First Federal Bank of Harrison, First Federal Savings & Loan Association of Texarkana, Newport Federal Savings Bank, Pocahontas Federal Savings & Loan Association and Heartland Community Bank of Camden.
Accompanying the Forrest City conversion was a 229,233-share issue of stock, valued at $15 per share.
The company repurchased chunks of its shares back in the day, which reduced its outstanding stock total to 183,312 shares.
That yields a $15 per share valuation in the sale to Cross County Bancshares: zero appreciation after 20 years.
At year-end 1994, total assets at Forrest City Savings were $40.5 million. Net income for the year was $126,000.
The lender’s largest year-end asset total was 2002: $84.2 million. Its most profitable year was 2001: $628,000.
The acquisition of Forrest City Bank will push the asset total at Cross County Bank to more than $250 million.
Cross County Bank has tallied a nearly $1.6 million profit through the first six months of 2014 after recording net income of about $2 million in 2013.
The $203.5 million-asset lender operates four branches in its namesake county: two in Wynne and one each in Cherry Valley and Hickory Ridge.
Outside of Cross County, the bank does business under a familiar name: First Commercial Bank in Jonesboro and Brinkley.
The business interests of its parent company extend to a 9.24 percent piece of Central Bank of Little Rock and a 6 percent stake in Pinnacle Bancshares Inc. of Rogers, holding company of Pinnacle Bank.
Central Bank was established in 2007 with the dormant charter of Bank of Blevins (Hempstead County). The $95.6 million-asset bank recorded a $1.4 million profit during 2013.
Pinnacle Bank of Rogers was formed in 2004 using the dormant charter of Bank of Pocahontas. The $90.4 million-asset lender reported net income of $158,000 last year.
The small profit follows a combined loss of about $9.2 million during 2009-11.
Other Mutual Conversions
What became of the other mutual thrifts that converted to stock ownership?
First Federal of Harrison and Heartland remain in business after undergoing financial travails and shifting ownership.
First Federal of Texarkana sold in 2001 to BancorpSouth Inc. of Tupelo, Mississippi.
Newport Federal was acquired in 2002 by Pocahontas Federal, which was in turn purchased in 2007 by Iberia-Bank Corp. of Lafayette, Louisiana.
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