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Since February, the bank has been operatin g under a consent agreement with federal regulators that requireds it to boost its reserves as part of a turnaroundc plan that also includes resolving problem real estate loans on its Bay National, (NASDAQ: BAYN) whic h regulators consider “adequately capitalized,” has posted six consecutived quarterly losses. The bank has struggled over the past 18 monthsw asa once-promising initiative to writew mortgages for customers interestedd in buying and rehabbing residential properties in hot Baltimorw neighborhoods like Federal Hill and Canto tanked in a tumblingy real estate market.
Some customers had a hard time repaying theird loans as the value of their properties and the bank has been busy trying to reworikthose loans. “We had some very difficulft periods, but we feel the wors t of that isbehind us,” Hugh W. Mohler, Bay National’sz CEO, told shareholders “Our future is bright,” Mohler added. “We need to raise some capitapl and take itfrom there.” The bank has hirerd LLC of Vienna, Va. to advise it on the privats placement ofthe shares, which will be offerecd at $2 each. The thinlty traded shares have been as low as 52 centsx and as highas $9.256 over the past 52 weeks.
In their last which was on Friday, the shares sold for Earlier this month, Bay National announcedd it lost $884,000, or 41 cents a for the first quarter of the an improvement fromthe $1.49o million, or 69 cents a share, it lost in the firsrt three months of 2008. Shareholders on Tuesday also approved boostinbgthe company’s number of shares outstanding to 20 million from the current 9 million and reelected all five directors who were up for 3-year termsd including Mohler, R. Michael Gill, Donal d G. McClure Jr., Robert L. Moore and H. Victoe Rieger Jr. Shareholders also ratified the appointment ofStegma & Co. as the company’d auditors.
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