Stock in White River Bancshares Inc. Sold at Auction for $18.8 Million

The U.S. Department of the Treasury recently auctioned off $18.8 million worth of preferred stock in White River Bancshares Inc., the holding company of Fayetteville-based Signature Bank of Arkansas, as part of the Treasury’s ongoing effort to redeem Troubled Asset Relief Program funds issued during the Great Recession.

Gary Head, CEO of Signature Bank, said Friday a New York investment firm bought all 17,640 shares.

“It wasn’t voting stock so it doesn’t change anything with our bank,” Head said.

He said that in 2009 when the TARP funds were issued his bank needed the money.

“It was a good thing and helped us make it through some tough times,” Head said.

White River was one of six banks or holding companies nationwide included in the auction. The auctions are set to close on or about July 2, with the department expected to bring in $64.4 million, according to the Treasury.

White River, along with 10 other Arkansas financial institutions, accepted federal funds through the Capital Purchase Program, a division of TARP, totaling $302.7 million. Under the program, the Treasury bought preferred stock in banks in return for a 5 percent annual dividend. White River accepted $16.8 million in TARP funds in February 2009.

In the White River auction, 16,800 shares of Preferred Stock Series A were valued at $1,063.21 per share, for a total of $17,861,928, and 840 shares of Preferred Stock Series B were valued at $1,205.55 per share, for a total of $1,012,662.

The total auction amount, $18.8 million, represents about 3.8 percent of the bank’s total assets of $489 million.