THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Tuesday, September 19, 1995 TAG: 9509190037
SECTION: BUSINESS PAGE: D2 EDITION: FINAL
SOURCE: BY TOM SHEAN, STAFF WRITER
LENGTH: Short : 42 lines
Essex Bancorp Inc., the Virginia Beach thrift holding company, said Monday it completed its planned acquisition of Home Bancorp Inc. and Home's thrift subsidiary in Norfolk.
With the transaction in place, Essex said its Essex Savings Bank unit finally met the minimum capital requirements imposed by federal regulators.
In June, a financially ailing Essex Savings faced the prospect of being taken over by the federal Office of Thrift Supervision unless it found a quick infusion of needed capital. Essex Savings' net worth had been battered in recent years by losses on sour real estate loans and writedowns in the value of mortgage servicing rights it had purchased.
As part of the transaction, Essex issued 2.25 million shares of preferred stock with a redemption value of $15 million to Home Bancorp shareholders. These shareholders also received warrants to buy as many as 7.95 million shares of Essex common stock beginning in September 1998.
Two representatives of Home Bancorp will join the Essex Bancorp board of directors.
Home Bancorp, based in Pittsburgh, bought the deposits and certain loans of a failed Norfolk thrift, also named Home Savings Bank, from the Resolution Trust Corp. in September 1994.
The RTC, the federal agency responsible for disposing of failed thrifts, sold the deposits and assets to Home Bancorp through a program that encouraged the formation of minority-owned financial institutions. Home Bancorp had qualified as a minority-owned bidder because three directors of its largest shareholder, Century Capital Inc., were African American.
The acquisition of Home Bancorp and Home Savings provides Essex Savings with six additional offices, bringing its branch network to 14. However, a Home Savings' branch in Newport News will be folded into an Essex office in that city, said Essex, whose deposits now total about $285 million. by CNB