Struggling California bank
on late Thursday said it may sell itself as it faces a serious liquidity crunch.
The Brea, Calif.-based savings and loan said as of Dec. 31, it had $21.1 million to address "ongoing operating expenses, debt service and inter-company settlements" It said it is working with investment banks Credit Suisse and Sandler O'Neill to "develop and implement strategic initiatives" to address the cash shortfall, a process that could lead to a sale, raising capital or restructuring debt.
Fremont said it could be forced to write down additional assets and bulk up reserves, which would further erode the $448.6 million in total equity capital it held at year's end. The bank said because of an ongoing review by its auditors, it would delay filing its 10-K due Friday with the Securities and Exchange Commission.
Fremont, which last year consented to a cease-and-desist order from the Federal Deposit Insurance Corp. that forced it out of residential subprime lending, agreed in May to sell its commercial loan business to
for $1.9 billion in cash.
Fremont previously said it was selling its residential real estate business to Ellington Capital Management.
Fremont shares were down 28 cents, or 10.6%, to $2.36 in recent after-hours action Thursday.
This article was written by a staff member of TheStreet.com.