LANSING, Mich. and PHOENIX, Aug. 18 /PRNewswire-FirstCall/ -- Capitol Bancorp Limited (NYSE: CBC) and Grandpoint Capital, Inc. announced jointly today the planned sale of Capitol's Tucson operations involving Bank of Tucson and Southern Arizona Community Bank to Grandpoint Capital, Inc.
The transaction will be structured as a whole-bank purchase of the single-office, $99.4 million Southern Arizona Community Bank, which is expected to generate aggregate cash proceeds in excess of $11 million, simultaneous with a traditional purchase-and-assumption transaction for the main office operations of the Bank of Tucson (involving total footings approximating $170 million). This transaction structure will enable Capitol Bancorp to retain Bank of Tucson's $40 million branch office in Nogales, and the existing $20.1 million of tangible equity residing at the entity as of June 30, 2010, while positioning Grandpoint Capital, Inc. to commence its new Arizona operations with a consolidated $270 million, Tucson-domiciled banking platform that will conduct business under the Bank of Tucson banner.
Capitol Chairman and CEO Joseph D. Reid said, "This sale will provide Capitol with access to new capital that will be used to support our ongoing strategic initiative to enhance balance sheet strength and assist those affiliates currently facing challenges."
"In 1996, Bank of Tucson's President and CEO Mike Hannley partnered with Capitol to organize its first bank outside of Michigan. He has played an integral role in the growth and development of Capitol, serving as both a corporate director and regional president overseeing the Arizona market. Through Mike's efforts, Bank of Tucson has been a consistent top performer. As Mike moves forward with Grandpoint Capital, Inc., I am confident that his customers will continue to enjoy the stellar service and community support that they have come to expect during the past 14 years."This transaction, which is subject to regulatory approval, is expected to be completed in 2010.