The head of a financing company planning to acquire Towson-based AmericasBank Corp. and inject the bank with more than $35 million in cash and assets said Tuesday that he sees a growing need for community banks in Maryland.
Jack Dwyer, owner of Baltimore-based Capital Funding Group, said the next step for his company is to become a bank. Dwyer formed Capital Funding Bancorp Inc. this year and he announced Tuesday the acquisition of AmericasBank, a small Maryland bank hit hard by mortgage-lending losses last year. AmericasBank operates three branches: Towson Community Bank, Annapolis Community Bank and AmericasBank in Highlandtown.
The transaction, arranged by the two companies without involvement of federal regulators, will enable Dwyer's health care financing business to tap into deposits to fund bridge loans to assisted-living and nursing home facilities. The business also offers lines of credit to health facilities that rely on Medicare and Medicaid reimbursements.
Merging the financing business with the bank "enables us to have access to funds to actually fund any preliminary bridge loans prior to getting FHA loans," Dwyer said.
The infusions into AmericasBank, which will include the $35 million plus a $1 billion loan-serving portfolio, will help strengthen the bank's core lending areas of commercial and mortgage lending, he said.
"We'll be much better than a well-capitalized bank," Dwyer said. "I want to be involved in community banking. It's the right thing to do for Baltimore. There is a need for a community bank that's well-capitalized in Baltimore. I see us taking a more conservative tone, back to the blocking and tackling of basic banking, where you're making no exotic mortgage transactions but just straightforward community bank lending,"
AmericasBank was placed under increased government supervision last year and dismissed its chief executive officer in the wake of losses stemming from turmoil in the mortgage lending business.
It is one of a number of local banks weakened by the mortgage crisis.
In January, Suburban Federal Savings Bank in Crofton became the first Maryland-based bank to fail since 1992.
First Mariner Bank, the second-largest bank based in Baltimore, is operating under an informal supervisory agreement and has had to transfer money from its holding company to maintain capital levels.
And in late February, the Office of Thrift Supervision issued "cease and desist" orders against Eastern Savings Bank of Hunt Valley and Baltimore's Bradford Bank.
AmericasBank's acting CEO, A. Gary Rever, said Tuesday that the acquisition will enable the bank to raise much-needed capital.
"It will allow us to do larger transactions in the community," he said. "We will focus on small-business loans. We will continue to do mortgages. Community banks need to do mortgages."
The acquisition is subject to approval by AmericasBank shareholders; the Federal Reserve, its federal regulator; and the state Office of the Commissioner of Financial Regulation, a division of the Department of Labor, Licensing and Regulation.
The deal is expected to close in the second quarter. Once the acquisition closes, A. Patrick Linton, senior vice president of Capital Funding Bancorp., will become president and chief executive officer of AmericasBank. Rever will serve as chief financial officer and Ellen Fish, current president, will serve as executive vice president of community banking.
The "vast majority" of the bank's 30 full-time employees will be retained, the companies said.