Daily News: January 6, 2014

Commerce Street Guides Park Cities Sale to Olney Bancshares

U. S. Bankruptcy Court in Delaware approved the acquisition of Park Cities Bank by Olney Bancshares of Texas. The sale is the culmination of a three-year work out process during which Commerce Street Capital (CSC), a Dallas-based investment banking firm, served as strategic advisor to Park Cities Bank and its parent, North Texas Bancshares (NTBC/PCB). This announcement was made today by Dory Wiley, president and CEO of CSC.

As part of the transaction, Park Cities Bank will merge with and into Interbank, the wholly owned banking subsidiary of Olney Bancshares of Texas. Interbank operates 36 banking locations in Texas and Oklahoma while Park Cities Bank operates four branches in the Dallas/Fort Worth area.

The sale and merger resulted from an auction process conducted in accordance with procedures approved by the U.S. Bankruptcy Court in the District of Delaware as part of the bankruptcy filings by North Texas Bancshares and North Texas Bancshares of Delaware under Chapter 11 of the Bankruptcy Code. A tentative agreement for the sale was approved by the bankruptcy court on December 17, 2013.

During the court-supervised auction, Olney Bancshares of Texas’s $11.4 million bid was deemed the highest or otherwise best offer received, beating a stalking horse bid by Park Cities Financial Group, an independent group of investors unaffiliated with NTBS/PCB.

Hatch Smith, CSC VP, was the lead financial advisor to NTBS/PCB. Smith’s and CSC’s team worked closely with NTBS/PCB’s leadership, regulators and numerous third parties during the three-year process.

CSC’s Smith noted, “We appreciate the persistence and vision of the NTBS/PCB leaders who worked diligently with the CSC team during an arduous and lengthy process that drew on the full resources of CSC, including our expansive investor network and ability to conceive multiple creative strategies in order to reach an optimal outcome from a challenging situation.”

CSC was first engaged by NTBS/PCB in November 2010 to assist the bank holding company with strategic alternatives, including exploration of the potential sale of distressed and non-performing assets, recapitalization sale and/or reorganization through bankruptcy. After several strategic initiatives and consideration by numerous investors, the decision was made to reorganize and conduct an auction for NTBS/PCB under Chapter 11 protection, §363 of the Federal Bankruptcy Code.

CSC’s Financial Institutions Group practice centers exclusively on serving the needs of the financial services sector. The group aims to provide sound, comprehensive advice, expert structuring and optimum execution to banks, bank holding companies and allied businesses. CSC is recognized as a leader in the industry for its valuation practice and providing clients with unbiased analyses and independent opinions required to fulfill their fiduciary obligations.

Dallas-headquartered Commerce Street Capital is a private investment banking firm.