As Levan has to keep $623.6 million in NONPERFORMING loans/assets as part of the sale to BB&T. Nonperforming loans that will certainly be subject to very substantial write-downs in future quarters.
While offsetting these assets is $331.7 million in Trust Preferred Debt plus $39.1 million in outstanding interest in arrears plus the remaining future interest Levan will pay off on this debt over time.
Which of course boils down to:
+$623.6 million in NONPERFORMING LOANS
-$331.7 million in Trust Preferred Debt
- $39.1 million in Outstanding Interest In Arrears
Equals a net of $252.8 million.
From which future loan loss write-downs must be deducted. Which could easily add up to another $100 to $150 million in unaccrued for losses over the next several years and could be as high as $200 million or more given ALL of these loans are the absolute worst on BuBbaX's books. Plus all the future Trust Preferred interest Levan will have to pay over time - which will more than likely be another $50 to $100 million in interest expense depending on how quickly the crony crew is able to pay it off.
But of course, "Levan said that he made this deal from a position of strength and not because the bank was in trouble." Per Brian Bandell's article, "Levan: Bittersweet Goodbye To BankAtlantic", in The South Florida Business Journal.
All I know is that BuBbaX had a market cap well in excess of $1 billion 5 years ago, and is now the bargain basement biotch boy sale of the week.
Nice job crony crew.
At least BB&T made Levan thoroughly scrape the inside of that rotting septic tank BuBbaX calls its loan portfolio before being allowed to slink off into the night.
Is it just me, or does anyone else find it interesting that BuBbaX's loan loss reserve was only around $300 million and had only been fully accrued for to the tune of around $150 million as of the end of Q2, but BB&T seems to think more than $600 million in BuBbaX's loans are too questionable to acquire?
Smells like another shareholder lawsuit to me. That is if anyone other than Levan, the crony and a few of the retards that like to smear their fecal thoughts all over this message board still owned any of BuBbaX's common stock.
Again, nice job crony crew.
Good luck with turning Bluegreen into another Levitt/Woodbrigde corpse.
I will predict that BBX finished 2012 near $10. I'm assuming that:
- European crisis doesn't crash the US finnacial system.
- Slow economic recovery continues
- BBX comletes the transaction, is breakeven excluding onetime gains in the first half of 2012 and solidly profitable in the second half of 2012.
- I believe we'll see Levan take some action to support the stock price of BBX sometime in 2012 such as either taking it private altogether or re-initiating a dividend.
BFCF is much tougher to give you a one year target for. I'll stick to my 3-5 year target of $20 for BXG (2.50 for BFCF).
Disc: Very long BXG, long BBX, slightly long BFCF.
Panick with Mkt problems what is your short term price target,(a year out)for bbx and bfcf,the 300 mill gain in itself shoud attact investors. Only issue i see is a total contagion from europe...No foreign risk but bank numbers with the tarp is frought with danger..Lucky we have you to sort this mess out and give us some clarity.Got to appreciate the way L man turned his enigma around. Another hedge fund that has creative layers is steel partners. Allways full of surprises...Regardless banks will be bought out and most of bbx when cleaned up will be up for sale. Wonder what l man will do with some cash,if anys left.
A 300 mil gain is not exactly giving away assets. By selling the assets BBX made a shareholder friendly move. They ensured that another round of capital raising and the resultant further dilution of shareholders would not be needed.
I think the real problem that buy and hold long term investors like you have is that you think that by selling assets BBX makes it harder to get back to your ridiculously high cost basis. If you're in for a split adjusted price of 300 or something ridiculous like that, you're not going to get back to that level (20 - 30 is possible in a few years) regardless of what they do. Increase your investment here at the lows if you want to have a shot at getting even or better yet do everyone a favor and take your tax loss and sell.
Next time buy a debt issue like BBXT. Remember that you can't dilute debt. It either gets repaid or the company goes bankrupt.
Let's not quibble about tax payer's losses with 15
trillion in national debt. It’s just a nice distraction
from the real BBX issue. The crew took another
nice severance package and gave away the banks only valuable
assets and left minority stockholders like you holding the bag.
The crew will now let the stock plummet so they can continue
to buy up more shares to reap full benefits of the BBT payoff.. We
have seen this movie before just look in the rear view mirror. Yeah
same guys and the same manipulation ! Good luck trading!
Saved the tax dollars "for the moment"? Do you really think a company with 650 mil in assets (many paying loans that have already been marked down severely), 90 mil in loan loss reserves, and 300 mil+ in equity is going to cost the tax payers money? BBX will no longer even be a regulated bank after the transaction. It won't have depositors or even be regulated by the FDIC. Tax payers are not even at risk there or do you still think BBT (16 bil market cap) is still about to fail?
If you are down 99% why don't you take your long overdue tax loss and move on? I'm certainly not going to pass up buying assets at 18% of book value because of your pity party. Hundreds of banks failed outright or lost most shareholder value in the financial crisis. Some did better than BBX and Levan, many didn't.
Your day trading results are amazing, Houdini.
And your analysis that the crew did not substantially
give away the bulk of BBX assets in trade for a
crew severance package is also amazing . The tarp rejection
and not the crew saved the tax dollars for the moment. The
stockholders who lost 99% of their value are probably
taxpayers as well . So you keep telling us how great these
guys are and maybe you will actually begin to believe it someday.
Too bad, too sad if you were a BBX sharholder and held for 5 years. I wasn't and what happened 5 years ago doesn't determine whether something is a buy or not today. As those who follow the BBX message board know, I reccomended BBXT or BFCF as better ways to play for a rebound on BBX on numerous occassions. Some folks did play it that way did very well and many thanked me. BBXT was trading around $8 when I first pointed out it was a smarter way to play than the equity and is now near 22. BFCF more than doubled before pulling back on the BXG merger deal.
Levan was overly optomistic and got caught by the economic downturn. Many other regional banks and othe financials companies also declined comparably. BBX and BXG have at least both survived and are now in a position to thrive as the economy recovers. These companies have not cost the taxpayers any money as many competitors have. You keep looking in the rear view mirror and I'll keep looking ahead.
Disc: Long BXG, BBX. No position at present in BFCF or BBXT.
I am sure the trusting Preferred s are buying into
your Houdini like trading skill! Maybe you can bring
the same comfort to BBX's stockholders! You know the
ones that have lost 99 % of their equity over the past five
years. Oh! By the way while eroding the stock value of BBX
and numerous other companies the crew cut a nice severance
package for giving valuable assets to BBT. More legal
issues ahead. I am sure Houdini will have a solution.
The trust pref holders are getting 3 years back interest and a resumption of interest payments when the deal closes. I took profits on BBXT shares that more than doubled when the deal was announced and I don't plan to sue (LOL). The company has done several things to benefit BBXT holders as I well know from trading the issue extensively. Capital was raised a few times. The PNC asset sale and the BBT asset sale both benefitted BBXT holders greatly.
I'm not a lawyer, but keeping 650mil+ of assets and a specialty lender is not a sale of the company or substantially all of it. BBXT has an 8.5% coupon, but some of the other issues have much lower coupons if I recall correctly. If you're locked in at 4% I can see why you'd want to try and opportunistically force an early redemption.