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Wednesday, 29 August 2007 |
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Page 2 of 2
Calvert said discussion of a possible merger between the two financial institutions began three months ago. “It’s a process of looking at the two franchises, forecasting the kind of growth they’d experience individually and together, and determining if a merger really would be in the best interests of all concerned,” he said.
Now that the first stage of the deal is done, the merger has to be approved by the U.S. Securities and Exchange Commission, the Federal Deposit Insurance Corp., the Federal Reserve, and the Comptroller of the Currency.
Only then will it be put before the shareholders of each bank for a vote.
Calvert said he would like to see the deal completed by year’s end but conceded it is more likely to close by first quarter 2008.
The combined company’s $800 million in assets will help it expand around the state, Calvert said. “It gives us a lot more leverage in the marketplace by increasing our legal lending limit,” he explained. “Having $800 million means you can make a lot of loans before you’ll reach your legal limit or have to find another lender to partner with on a loan.”
Asked whether the sub-prime lending crisis and talk of a national credit crunch have affected First National’s lending practices, Calvert said it hadn’t.
“We're in the business of making loans,” he said. “In fact, our business is trying to find ways to make loans and not turn them down,” he said. “So our direction has not changed. We continue to see good loans—loans based on ‘A-paper’. In other words, (we’re seeing) loans predicated on the borrowers’ verifiable ability to pay the loan back.”
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