Tennessee Commerce Bancorp, Inc (fka TNCC)

[Investox]

Comeback ?

Tennessee Commerce under watch, selling assets

Tennessee Commerce's bid to sell assets to other lenders accomplishes several things amid its ongoing search for investment. Shrinking the bank means the capital it does have provides a more sufficient cushion, industry professionals say, and it also generates cash and frees up other money the bank had set aside to cover risky loans.

New cash increases the chances federal regulators will remain comfortable with the bank's situation, sources say, buying it time while it courts suitors that could theoretically include other banks, private equity groups or individual investors. Raising money on the capital markets is difficult in current economic conditions, particularly for a bank under regulatory scrutiny.