Decatur State Bank Sold

by Talk Business & Politics ([email protected]) 109 views 

Mathias Bancshares Inc. of Springdale, the one-bank holding company that owns First State Bank of Northwest Arkansas, has reached an agreement to purchase Decatur State Bank, it was announced late Friday.

MBI is led by Sam Mathias.

First State Bank of Northwest Arkansas had total assets of $82 million on Dec. 31, and had a year-over-year increase in assets of about 4.1 percent. Its 2011 net income was about $870,000.

DSB is one of two banks owned by Peterson Holding Co. of Decatur. PHC will retain 100 percent ownership of Grand Savings Bank, located in Grove, Okla.

According to a joint news release issued by MBI and DSB, a definitive agreement was reached on April 12. The transaction will be a stock purchase wherein the parties agree that PHC will sell 100 percent of its stock ownership in DSB to MBI. No other details of the transaction were available Monday.

Final regulatory approval is expected sometime early in the third quarter, the release said.

DSB entered into a consent agreement with the Federal Deposit Insurance Corp. on Nov. 18. The order requires the bank to reserve an additional $6.126 million for possible loan losses and to shore up its capital.

DSB had assets of about $165 million on Dec. 31, but that reflected a drop of about 20 percent, or $12.7 million, since Dec. 31, 2010.

Other real estate owned, property recovered from failed mortgages, totaled $3.6 million at Decatur State Bank as of Dec. 31. Total non-accrual loans, meanwhile, amounted to almost $21 million.

“While the bank does have some acknowledged asset quality challenges coming out of the last few recessionary years, we are obviously confident these problems can be remedied over the next couple years,” Mathias said in the release. “A good degree of progress on these challenges has already been made over this past year.

“The bank has a good staff which we intend to keep intact to continue the efforts already set in motion to return the bank to a satisfactory and profitable condition.”

MBI intends to retain the separate charter of DSB and continue to operate it as such, according to the release.