Capital Bank makes move to buy Southern Community Bank

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CEO: Proposal needs federal approval, branches to stay open

A Florida financial firm plans to purchase the parent company of Southern Community Bank and Trust, which has a branch, pictured here, on Hendersonville Road, in Asheville. Hank Shell/Carolina Public Press

Miami-based Capital Bank Financial Corp. plans to buy the parent company of Southern Community Bank and Trust, signaling yet another change to local and regional banking in Western North Carolina.

Capital Bank Financial, which is the parent company of Capital Bank, N.A., announced on March 27 that it had signed a definitive agreement to acquire 100 percent of Southern Community Financial Corp.‘s stock, its $1.5 billion in assets and its 22 branches. Southern Community Financial is the parent company of Southern Community Bank and Trust, which has a branch on Hendersonville Road, in Asheville.

But a definitive date for finalizing the Southern Community-Capital Bank acquisition has not been set, according to F. Scott Bauer, chief executive officer of Southern Community Financial Corp. and Southern Community Bank and Trust.

Southern Community Bank and Trust has had a presence in WNC since March 2007, specifically at its 1751 Hendersonville Rd. office. Founded in 1996, Southern Community also has offices in Forsyth, Guilford, Iredell, Rockingham, Stokes, Surry, Wake and Yadkin counties.

“Capital (Bank) is in a quiet period working on their initial public offering,” Bauer said. “Once that takes place in the next 30 to 45 days, the next step will be to complete the transaction.”

Final regulatory approval of the acquisition is also still in process, he said.

If the transaction is finalized, all Southern Community Bank and Trust offices will become Capital Bank offices, Bauer said. It will also mean that Capital Bank will have $8.1 billion in assets and 165 branches in North Carolina, South Carolina, Tennessee, Virginia and Florida.

According to its website, Capital Bank currently has four branches in Western North Carolina – three in Buncombe County, all of which are in Asheville, and one in Madison County, in Hot Springs.

The Southern Community acquisition comes after other recent banking changes in Western North Carolina, including the closure of two banking institutions by the Federal Deposit Insurance Corp. in 2011.

On Jan. 21, 2011, the FDIC took over the failed Bank of Asheville, transferring the bank’s deposit accounts to First Bank, headquartered in Troy, N.C. And on Oct. 14, 2011, the FDIC shuttered Asheville-based Blue Ridge Savings Bank, moving all deposit accounts, including brokered deposits, to the Bank of North Carolina, in Thomasville, N.C.

Bauer said that Southern Community’s board agreed to the acquisition because they believe Capital Bank has “an underlying foundation to benefit (Southern Community) and its customers long-term.

“Our board felt Capital had the strength – substantial capital strength – and access to capital that a lot of banks in these days and times don’t,” he said.

“One of the good things about this acquisition from our standpoint is that all of our branches will remain open,” Bauer said. “The biggest benefit will be that our branches will remain and our people will remain to continue to deliver an excellent quality of service.”

Bauer said the types of services Capital Bank and Southern Community offer customers are comparable.

As the banks hone in on a more definitive date for the transaction’s completion, Bauer said Southern Community planned to send out information to its customers.

“We’re all doing our best to make it as smooth a transition as possible,” he said.

Capital Bank Financial was formerly known as North American Financial Holdings, a bank holding company incorporated in late 2009 with the goal of creating a regional banking franchise in the Southeastern United States, according to Capital Bank’s website.

A Capital Bank spokeswoman did not comment on the proposed acquisition.

In the March 27 press release announcing the acquisition agreement, Capital Bank Chief Financial Officer Chris Marshall was quoted as saying, “This acquisition continues to demonstrate the disciplined execution of our business plan and the expansion of our franchise into the most attractive markets in the Southeast.”


Find out more about your bank

If you want to find out more about the finances and operations of your bank or of other financial institutions in Western North Carolina or the rest of the United States, for that matter, there are many online resources worth exploring.

Online sources of information about banks’ assets, regulatory actions they may be facing and more include:

The Federal Deposit Insurance Corporation, or FDIC, is the primary federal regulator responsible for overseeing state-chartered banks that are not members of the Federal Reserve System and state-chartered savings associations. The FDIC also insures consumers’ deposits in banks and savings associations in the event that a bank fails.

The Federal Reserve Board, or FRB, is the main federal regulator of state-chartered commercial banks that are members of the Federal Reserve System. The FRB also has a section on its site called Federal Reserve Consumer Help.

The Office of the Comptroller of the Currency, or OCC, charters and regulates nationally chartered commercial banks and federal savings associations. The OCC also has section of its site called Answers and Solutions for Customers of National Banks.

The Federal Financial Institutions Examination Council’s Consumer Help Center directs consumers with complaints and questions about their bank or financial institution to the appropriate federal bank regulatory agency that can help them with their concerns.

The National Credit Union Administration supervises and insures federal credit unions and insures state-chartered credit unions.

The Conference of State Bank Supervisors, or CSBS, is the professional association of state officials responsible for chartering, regulating and supervising the nation’s state-chartered banks and state-licensed branches and agencies of foreign banks. State banks also are supervised by state banking regulators. The CSBS website also has links to state banking departments.

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About the Author

Kathleen O. Davis

Kathleen O. Davis is a contributing reporter to Carolina Public Press. Contact her at kathleenodavis@gmail.com.

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