Published: August 14, 2014 at 10:18 am EST
By: Martin Blanc
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BNK SFBS FCB
C1 Financial Inc (BNK), a regional bank based in Florida, has begun trading on the New York Stock Exchange (NYSE) today, after selling around 2.6 million of its common shares for $17 apiece. Bruyette & Woods Inc., Raymond James & Associates Inc., and Keefe will be co-book runners for the IPO offering.
The underwriters will have a 30-day option to scoop up an additional 394,737 shares at the offer price minus the underwriter discount. The IPO price of $17 set last night is less than the $18-20 range expected earlier, signaling muted investor interest. The sentiments seem especially true considering that C1 Financial stock is flat as of 10:12AM EDT.
The company has 29 locations and $1.4 billion in assets in Florida, according to its S-1 filing with the SEC. It plans to raise around $50 million from the IPO, giving it a market cap of approximately $300 million. The bank is also in the top 5th percentile of all banks in the US in terms of asset growth, with the value of assets increasing more than five-fold in the last four years to $1.4 billion as of June 30, 2014.
In 2013, C1 Financial made $418 million in loan commitments with a focus on business and entrepreneurship in Florida. The bank believes in a simple deposit account system with only two types of checking accounts for businesses and families.
Its non-interest bearing deposits have grown at a compound annual growth rate (CAGR) of 83% since 2010, clocking in at $226 million as of March 31, 2014. Overall deposits have grown at a CAGR of 47% in the same period to $1.1 billion.
C1’s banking operations are primarily concentrated in Tampa-Bay, Miami-Dade, and Orlando. The bank manages risk by limiting fixed rate loans to a maximum of five years. More than 60% of loans have some kind of a variable component. The company plans to open four new banking centers by 2015 and one loan production office by the end of the current year.
It will use IPO proceed for working capital and other general corporate purposes, which might include growing business organically as well as inorganically. It does not intend to pay dividend in the near future, and will use its free cash flows for growth purposes.
The profit before income and taxes was $19.6 million for fiscal 2013 (FY13), up 80% year-over-year. The worth of total assets rose 40% to $1.3 billion. The adjusted yield on loan clocked in at 5.59% for the year, up from 5.44% in FY12. The adjusted cost of deposits fell from 0.8% to 0.59% during the same period.
FCB Financial Holdings Inc (FCB) and ServisFirst Bancshares, Inc. (SFBS) both have significant presence in Florida and had their IPO’s recently. However, both are trading below their offer prices. It remains to see whether C1 Financial’s IPO performance can reverse this trend. C1’s stock performance in the first hour of trading on the NYSE does not seem to indicate any reversal.
NUVOLA........JUST GOT TO KNOW WHERE TO LOOK!!!!!!
