CEO Cashes Out as Bank Seeks U.S. Loan
A call to the Treasury Department press office was not returned.
Treasury, through the $700 billion financial rescue plan approved by Congress earlier this month, plans to make $250 billion of preferred equity investments in banks to shore up confidence in the system and thaw frozen credit markets.
A host of regional banks, including PNC Financial Services (PNC) and KeyCorp (KEY), have disclosed investments this week. Banks have until Nov. 14 to apply and, if accepted, agree to join the program.Whittle's stewardship of The South Financial Group, which he founded in 1986, has been less than stellar. The Greenville, S.C.-based holding company that includes Carolina First Bank, Mercantile Bank, Bank CaroLine and SouthGroup Wealth Management, has seen its shares fall from over $25 last year to a low of $2.52 on July 15 due largely to its portfolio of residential construction loans in Florida. Shares closed up nearly 17% to $4.75 Tuesday. According to a Securities and Exchange Commission filing, the company said it "expects to recognize approximately $12 million in incremental expense" connected to Whittle's departure. Stock options and other benefits could raise the total significantly. "He's leaving at the request of the board, is how I'd put it," Barkstrom says. During the call last week, Brian Rohman, an executive at investment firm Robeco Investment Management, questioned the company's plans to allow Whittle to serve out his term on the board, which expires in 2011. "I understand Mack is leaving the CEO role at the end of the year. But given the problems with the company over the last couple of years, can you justify why he's going to stay on the board?" Rohman asked. Whittle replied he planned "to serve out the wishes of the shareholders." Pressed by Rohman, Whittle said the company was not pressuring him to step down. Rohman declined further comment to TheStreet.com and Whittle did not return a call to his home. The South Financial Group is still searching for a CEO while John C.B. Smith, its lead independent director, runs the board and oversees company operations. Smith did not return a phone call.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV