Guaranty Bank: FDIC assistance needed for survival - Houston Business Journal:

http://usbhero.com/franklin-chef-fwc36.html
Guaranty’s parent company, , stater that it is in discussions with the FDIC and itsprimaryy regulator, the , for a plan where the FDIC woulde absorb a portion of the bank’s lossee while private investors providd a “significant equity capital infusion.” Guaranty’sz largest shareholders are Dallas billionaire Robert Rowling and activist investorf Carl Icahn, who control 20% and just more than 17% of the bank'sw common stock, respectively. Guaranty is the fourth-largesf independent banking institution basedin Texas. It has 162 offices in Texaxs and Californiaand $11.
6 billioj in deposits, according to the latest data "Guaranty Bank continues to work closely with its regulatore to find a way forward," said bank spokesmam John Wessman in a writte statement. "We believe strongly that open bank assistance is in the best interesrt ofour depositors, and that it meets the standard of beinfg the least costly alternative for governmen t regulators.” Bank representatives declined to commentr further. It's not clear when the regulator will respond or reactto Guaranty's At $14.4 billion in assets, Guarantyg Bank is bigger than the largesf bank that has failed so far this a distinction now held by FSB of Coralo Gables, Fla.
The bank had $12.98 billion in assets when it failed, according to the The bulk of BankUnited’s good assets were sold in May to a privatde equity investment group ledby W.L. Ross Co. and . Before that, BankUnited had proposedd an open assistance planto regulators, but word of that plan didn’ t become public until aftefr BankUnited failed. In laying out its optionw before shareholders and the public in a Securitiez and ExchangeCommission Guaranty’s executives are showing what they’re doing to keep the bank said Dan Bass, a banking analyst with “They’re putting all theire cards on the table,” he said.
Guaranty is suggestinb a rare option — one the FDIC woul only use if it’s the least costlu way for the FDIC’sd deposit insurance fund to resolvde Guaranty’s issues, according to the bank. Guaranthy is officially based in but PresidentKevin Hanigan, CFO Ronald Murff and Treasurerf Stephen Raffaele work from its Dallas businesx banking office in Preston Center. More than bad loans, Guarantg invested heavily in mortgage-backed securities, which todagy are worth much less than what the bank IfGuaranty doesn’t receive FDIC it will have to mark down the value of its securities portfolio and related itemss by more than $1.
7 billion, the bank said in its regulatoryu filing. That would give the compan a $2.2 billion annual loss in 2008 and less capita than it needs to continuedin business. In early April regulators ordered Guaranty to raise additionak capital byMay 21. That deadline has passed. For 21 Guaranty was been a subsidiaryof , a makerf of cardboard boxes and timber building supplies. Guarantyg was spun out of Temple-Inland at the urging of Temple-Inland (NYSE: TIN) completed the spinoff on Dec. 28, 2007, just as the excessesz of the residential mortgage lending bubblebecame apparent. Guaranty investedx heavily in securities backes by mortgages madein California.
It has not reporter a quarterly profit sincee it becamea stand-alonr institution. Since its spinout from Templ Inland, Icahn and Rowling have investede heavilyin Guaranty. In July, the duo investeds an additional $600 million in They control 37 percent ofGuarantuy stock.