Eighty percent of portfolio is categorized as performing loans.Merrie Duncan, marketing director for Oklahoma City-based FirstFinancial Network Inc., tells GlobeSt.com that the pool mixincludes seven gaming loans totaling nearly $66 million that willbe individually offered. "That's an interesting spin on thisportfolio," she says.

|

Thirty-seven percent of the portfolio's properties are locatedin Arizona, 36% in Nevada, 15% in California and the balancescattered throughout other western and southwestern states. Duncansays the portfolio will be marketed to First Financial'straditional wholesale loan buyers, commercial real estate investorsand financiers of gaming properties.

|

First Financial has divvied the portfolio of fixed and variablerates into stratified pools. Any loan exceeding $5 million isconsidered a single pool. A hotel, encumbered by $16 million, isconsidered one pool as is an eight-loan residential package with a$2.2-million debt. "The reason this is done is to increaseparticipation," Duncan explains. "This allows investors to selectwhat they want."

|

First Financial was awarded a five-year contract with the FDICin December 2007 to sell loan portfolios of failed institutions.Duncan says the past two quarters have been particularly active,with the number of bidders steadily increasing, more bank failuresand more private sector banks looking to shed their loads. Theincreased activity has brought out more US-based bidders thanbefore as traditional real estate investors, some REITs and privateequity firms step into the action. "They see the opportunityobviously and are looking to these offerings as an alternative,"she says.

|

First Financial's MO is to do a bid date and award the dealswithin 48 hours. Duncan says closings most often are held two weekslater depending on the portfolio size.

|

Shuttered in July, the locally based First National Bank HoldingCo. owned the First National Bank of Nevada in Reno, which alsooperated as the First National Bank of Arizona, and First HeritageBank of Newport Beach, CA. The FDIC stepped in as receiver,immediately selling its 28 branches and all deposits to Mutual ofOmaha Bank. The shutdown came on a Friday; the buyer's flag went upthe following Monday to allow for a seamless transition.

|

In the FDIC's press release about the closure, it points outthat it was only the second time in two years and 10 failedinstitutions that all insured and uninsured deposits were acquiredby another bank. As of June 30, First National Bank of Nevada had$3.4 billion of assets and $3 billion of deposits. First HeritageBank has $254 million in assets and $233 million in deposits. Thebuyer also agreed to buy about $200 million of assets from thereceiverships. The transactions' cost to the Deposit Insurance Fundwas $862 million.

|

First Financial's end of the disposition is to hawk 585 loans ofthe failed bank. In addition to gaming and residential loans, theportfolio includes industrial, retail and office properties and SBA504 notes.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.