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Seacoast Banking Corp. of Florida Message Board

  • sambordulac sambordulac Jun 23, 2009 9:04 AM Flag

    Seacoast stopped payment on TARP preferred

    By MarketWatch

    LOS ANGELES (MarketWatch) -- At least three small, cash-strapped banks have stopped paying the U.S. government dividends that they owe from taking part in the Treasury's Troubled Asset Relief Program, The Wall Street Journal reported late Monday.

    Pacific Capital Bancorp /quotes/comstock/15*!pcbc/quotes/nls/pcbc (PCBC 3.31, -0.32, -8.82%) of Santa Barbara, Calif., Seacoast Banking Corp. of Florida, /quotes/comstock/15*!sbcf/quotes/nls/sbcf (SBCF 2.59, -0.59, -18.55%) Stuart, Fla., and Midwest Banc Holdings Inc. /quotes/comstock/15*!mbhi/quotes/nls/mbhi (MBHI 1.08, -0.20, -15.63%) of Melrose Park, Ill., had frozen dividend payments to the U.S. government due to financial problems, the report said.

    The three had received a combined $315.4 million in capital infusions under the TARP, the report said.

    "Treasury respects the contractual rights of [TARP recipients] to make decisions about dividend distributions, and that banks are best positioned to decide how to manage their own capital base," the report quoted Treasury spokeswoman Meg Reilly as saying.

    (Full story at WSJ)

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    • Hi Sam. Thanks for your response and clarification. I understand now. It will indeed be interesting and I'm hoping that shareholders will be the focus from the BOD's.

    • Things must really be getting bleak around old Seacoast to suspend dividends on the TARP Preferred. What a distinction, one of only 3 TARP banks to stop paying dividends to the Treasury. I thought I read somewhere that the terms of the TARP provide that after 4 or 5 quarters of not paying the dividends on the TARP Preferred, the US Treasury has the right to appoint a couple of new board members. That could actually be a good thing. Some new directors appointed by Treasury might actually do something about the incompetent management and their fat salaries.

    • Anyone interested in calling SBCF to see what they say about this? I would love to know their plan out of this mess.

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