Heritage Oaks Bancorp, owner of Paso Robles-based Heritage Oaks Bank, received a $4 million investment Monday, the final piece in a private placement deal that has raised $60 million in capital for the company.
The company closed escrow with private investors Patriot Financial Partners and Patriot Financial Partners Parallel for the issuance of 4,072 additional shares of preferred stock in exchange for about $4 million. The $4 million was held in escrow at Wells Fargo bank while the company awaited approval from regulatory agencies.
This week, the company used $3.3 million of the proceeds to buy back the $5 million in trust preferred securities, or investments characterized by both debt and equity, issued by the holding company’s trust.
The repurchase means that the company received a gain — pre-tax — of about $1.7 million and results in annual savings in interest expense of about $344,000.
The deal also means that Patriot Financial Partners will now own about 14.4 percent of the company.
Bank officials have said that the move to raise $60 million in capital put the bank on stronger financial footing and helped it to address recent regulatory agency concerns.
In March, the Federal Deposit Insurance Corp. and the state Department of Insurance ordered Heritage Oaks Bancorp to increase its capital ratios, reduce its classified assets and increase board oversight of management.
It was also required to submit a capital plan to the Federal Reserve Bank of San Francisco, which supervises and regulates bank holding companies.
Heritage Oaks Bancorp, with assets of about $1 billion in the first quarter, reported a net loss of $1.3 million for the first quarter of the year, primarily attributed to a $5.2 million provision for loan losses.
— Julie Lynem
Magazine lauds local wine event
Wine Spectator magazine recently ranked the 2009 Central Coast Wine Classic as seventh in the nation for its live auction results, which at $738,100, were up 7 percent in 2009.
Emeril Lagasse Foundation’s Carnivale du Vin Auction and the V Foundation Auction were the only other charity wine auctions nationwide that had an increase in revenue, according to the magazine.
Proceeds from the Wine Classic are used to fund the projects of nonprofit groups in San Luis Obispo and Santa Barbara counties whose missions are tied to healing, performing or studio arts.
Over the past six years, the Central Coast Wine Classic Foundation has given grants totaling $1.37 million to 62 nonprofit groups. This year’s event is scheduled for July 8 to 11.
— Julia Hickey
Partnership aims at economic boost
The Business Assistance Center at Cuesta College and the Paso Robles Chamber of Commerce recently entered into a collaborative agreement to help the Paso Robles small-business community with job creation and retention, and support its ability to affect local and regional economies.
The Business Assistance Center at Cuesta College will provide consulting services to businesses and industry sectors identified by the Chamber of Commerce as in need of business technical assistance.
The center recently gave $10,000 to the chamber to hire an intern.
— Julia Hickey