8-K/AAcquisitions & DispositionsExhibits & Filings

FIRST CITIZENS BANCSHARES INC /DE/ 8-K/A Report, Acquisition Completed (May 21, 2010)

Filed May 21, 2010For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

This 8-K/A filing by First Citizens BancShares, Inc. (FCNCA) serves as an amendment to a previous report, providing updated disclosures and required financial information regarding its acquisition of substantially all assets and liabilities of Sun American Bank. The acquisition, completed through its subsidiary First-Citizens Bank & Trust Company (FCB) on March 5, 2010, was an FDIC-assisted transaction. Notably, the filing details the fair value of assets acquired, totaling $530.7 million, and liabilities assumed, amounting to $514.2 million, with a significant portion including loans and deposits. The key takeaway for investors is the structure of the deal, heavily influenced by loss-share agreements with the FDIC. These agreements provide substantial protection against potential losses on purchased loans and Other Real Estate Owned (OREO), with the FDIC covering 80% to 95% of covered losses. This significantly mitigates risk for FCNCA and is a critical factor in the transaction's financial impact. The filing also confirms that the acquisition did not materially impact the company's "well-capitalized" status.

Key Highlights

  • 1First Citizens BancShares, Inc. (FCNCA) amended its Form 8-K to provide updated disclosures and financial information related to the acquisition of Sun American Bank.
  • 2The acquisition was completed on March 5, 2010, through its subsidiary First-Citizens Bank & Trust Company (FCB) via an FDIC-assisted transaction.
  • 3FCB acquired assets with a fair value of $530.7 million and assumed liabilities with a fair value of $514.2 million.
  • 4The transaction includes significant loss-share agreements with the FDIC, providing 80%-95% coverage for potential losses on purchased loans and OREO.
  • 5The company recorded a gain of $27.1 million on the transaction, resulting from the difference between fair values of acquired assets and assumed liabilities.
  • 6The acquisition's impact on FCNCA's and FCB's capital ratios (Tier 1, Total Risk-Based, and Tier 1 Leverage) was not material, maintaining "well-capitalized" status.
  • 7The filing provides detailed breakdowns of acquired investments, loans (by type, maturity, and interest rate type), and deposits (by type and maturity).

Frequently Asked Questions

This filing is an amendment to a previous Form 8-K to update disclosures and provide necessary financial information related to the acquisition of Sun American Bank's assets and liabilities by First Citizens BancShares, Inc.'s subsidiary, First-Citizens Bank & Trust Company.

First Citizens Bank & Trust Company has entered into significant loss-share agreements with the FDIC. Under these agreements, the FDIC will cover 80% of covered loan and OREO losses up to $99.0 million, and 95% of losses exceeding that amount, providing substantial protection against credit risk.

No, the filing indicates that the acquisition of Sun American Bank, along with another prior acquisition (First Regional), was not material to the risk-based capital ratios or leverage ratios of First Citizens BancShares or its subsidiary. Both entities maintained their "well-capitalized" status.

First Citizens BancShares recognized a gain of $27.1 million on the transaction. This gain resulted from the difference between the estimated fair values of the assets acquired and the liabilities assumed from Sun American Bank.