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Cascade Bancorp Message Board

  • blazerdog11 blazerdog11 Feb 6, 2010 2:45 AM Flag

    All this is interesting, but...

    The market has spoken on CACB. They tried to raise capital and there were no takers. So, if Bolger and company were to still stand by to inject $65 mil and they could raise $93 mil from a public offering at, say .50 cents per share. Do you know how many shares that is? Yeah, 316,000,000 shares. They only have 28 million outstanding now. So, if they were to survive after the capital raise the stock probably wouldn't hit a buck for years. Of course they would do a 10 for 1 reverse split and it would probably trade for $3 or 4 bucks. The problem is I don't think they could sell stock for 50 cents. The FDIC's job is to protect the depositors and do what is best for the community which is to shut it down and have it taken over by any bank with a decent balance sheet. As long as they don't have to pay anything for the deposits and the foot print it is worth the hassel. Of course the shareholders will get wiped out but they effectively are in that position already. Too bad for the founders and management, but they forgot the lessons of the early eighties. A town built on rising real estate prices eventually had to pay the price. I'll never forget how guys like Roger Shields, Arnie Swarens and Jake guided the bank clear of the real estate overextension in the early eighties. They knew the risk of a little town built on recreation and land speculation. They had to as they operated business there for years. As the market imploded they listened to the moans from doctors and speculators who were left holding the bag. This time it's the stockholders turn in the barrel.

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    • what if they do a reverse split now 10 to 1 at app $5, adds app 30M shares to the 3M (after the split) existing shares then buy back the 3M shares later when appropriate, in the meantime sell off some assets and lower operating costs and what? they are back in business! too far fetched? or possible?

    • Blazer- your post in right on. Many folks don't realize that without selling a share the "early" and that includes the directors, have had all their money returned to them in dividends over the years. So only the new stockholder, last then years or so will be the losers.
      Whoever buys the deposits from the FDIC will likely not pay any premium and they will cherry pick from the loans. What they will get is a great footprint for success when the economy begins to build again.
      I sure don't see any banks in Oregon that have the capital or personnel to take on Cascade. Umpqua could if given a few more months to get ready. Of course the bank could be taken private!
      As I say, the wait continues.

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