Monday, August 3, 2009

Citizens Business Bank plans to repay the citizens

This story ran recently:

The Ontario-based parent of Citizens Business Bank is joining several large national and regional banks in returning money to the federal government.

CVB Financial Corp. has initiated an offering of about $115 million of its common stock. Subject to approval by the U.S. Treasury and banking regulators, CVB intends to use proceeds to buy back much of the preferred stock sold late last year to the federal government, as part of a nationwide capital purchase program....

We've heard of bigger banks deciding that government financing was bad for them. Now it looks like Citizens Business Bank (formerly Chino Valley Bank) is in the same pickle as the big boys.

Michael Natzic, a community banking specialist in the Big Bear Lake office of brokerage firm Stone & Youngberg, said several banks have decided in recent months that they don't need the safety net that the program initially provided them.

Also, some banks have chafed at the dividend requirement -- initially 5 percent per year -- that came with accepting the funds.

The article goes on to note Natzic's comment that Citizens Business Bank is doing well...unlike, say, Vineyard National Bank.

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