Wednesday, April 30, 2014

CommunityOne Bancorp reports 3rd consecutive quarter of profitability

Charlotte-based CommunityOne Bancorp, the holding company for CommunityOne Bank, said Wednesday that it made a profit of $1.3 million in the first quarter, compared with a loss of $4.6 million a year ago.

It was the third profitable quarter in a row for CommunityOne Bancorp, once known as FNB United Corp. The holding company's name was changed to CommunityOne Bancorp last year after it completed the merger of Granite Falls-based Bank of Granite and Asheboro-based CommunityOne Bank as part of an effort to save the teetering lenders.

CommunityOne Bancorp said first quarter interest income and noninterest income were lower than the same quarter last year. But the bank reported lower expenses, including a $5.5 million reduction in noninterest expenses that were partially the result of the merger.

“We made solid progress during the quarter in achieving the four key goals we established for 2014,” CEO Brian Simpson said in a statement. “Both loan and deposit growth were broad-based and slightly ahead of plan, noninterest expenses were down year over year even though we are investing in strategic initiatives and asset quality improvements were ahead of schedule with nearly no credit cost.”

CommunityOne Bank, which is based in Asheboro, has $2 billion in assets and 50 branches in North Carolina, including in the Charlotte metropolitan area.

Tuesday, April 29, 2014

Blueharbor bank profit rises

Mooresville-based Blueharbor bank said Tuesday that its first quarter profit grew about 32 percent from a year ago, reaching $243,518.

Assets grew from the end of the year as the bank increased its loan portfolio by about 7 percent, to $106.9 million.

But CEO Jim Marshall says he's seen signs of a slowing economy, including declines in teh stock price of national homebuilders.

"Time will tell if these developing clouds will influence what now appears to be a growing and healthy local economy," he said in a statement.

Bank of America stock begins to rebound

A day after Bank of America shares were pummeled by the news the Charlotte bank would have to suspend its dividend increase and stock buyback program, investors sent the stock price climbing back up.

Bank of America's stock rose about 2 percent, closing at $15.24. That came the day after shares fell more than 6 percent.

A number of analysts recommended investors buy shares on the dip.

The bank's shares are still down 2 percent so far this year after two straight years of sizable gains.

BB&T increases dividend 4 percent

BB&T announced Tuesday that it is increasing its quarterly dividend by 4.3 percent, or a penny per share, to 24 cents.

The move comes after federal regulators approved the Winston-Salem bank's capital plan last month. At the time, BB&T said it got the go-ahead for a "conservative increase."

"We are pleased to provide a dividend increase to our common stock shareholders," CEO Kelly King said in a statement Tuesday. "We remain committed to providing strong long-term returns to our shareholders."

Bank of America had planned to increase its dividend from 1 cent to 5 cents, but suspended those plans this week after disclosing it miscalculated its capital ratio.

Monday, April 28, 2014

What others say about BofA's math error


 A "disgrace."

A "capital offense."

A "serious blow."

Those are among the reactions from around the Web to Bank of America's surprise news Monday that the bank is backing off of plans to raise its quarterly dividend after it miscalculated its capital ratios.

The bank had planned to increase the dividend to 5 cents from the 1 cent it had been stuck at since the financial crisis. But on Monday it said it is suspending that plan, as well as a plan to buy back $4 billion in common stock, after discovering it had incorrectly accounted for notes inherited in its 2009 Merrill Lynch acquisition.

The news comes just two weeks after the bank shocked investors with the announcement that it lost $276 million in the first three months of 2014, a loss that partly stemmed from the need to increase by $2.4 billion the funds it sets aside to cover legal costs.

Longtime shareholders of the bank who had been counting on the dividend as retirement income were, not surprisingly, upset by Monday's news. “It’s a disappointment, no doubt,” Alan Goozner, a retired federal contractor in Charlotte who has owned shares in the bank for at least 15 years, told me Monday morning as he monitored the fall of the stock price.

Here's a look at how some other people reacted to Monday's news:

  • John Maxfield, in a post for The Motley Fool, wrote that Bank of America shareholders would "be excused for being disgusted." He called the news a "serious blow" to the bank. Maxfield also wondered whether "the mounting tally of legal settlements and revelations of highly questionable business practices aren't exceptions to Bank of America's standard operating procedure. Instead, perhaps they are its standard practice." He then goes on to say that he "can't help but admit that I'm still optimistic about the bank as a long-term investment."
  • David Reilly, in a Wall Street Journal piece with the headline "Bank of America's Capital Offense," wrote that Monday's news, coupled with reports that the bank may enter into a $10-billion-plus legal settlement with U.S. prosecutors over mortgage bonds, "underscores the operational and regulatory risk that is ever present for a bank this size." For investors, he wrote, Monday's news means they have "to adjust their thinking about ... BofA's ability to manage its sprawling empire."

Sunday, April 27, 2014

BNC Bancorp earnings jump

The parent company of Bank of North Carolina said Friday that it's net income for shareholders jumped 73 percent in the first quarter, to $6.5 million from $3.8 million a year ago.

CEO Rick Callicut said BNC Bancorp's performance came despite weaker than expected mortgage and commercial loan businesses, which he said were affected by cold weather.

The bank also launched a home equity line initiative at the end of 2013 that's resulted in $80 million in loan closings.

The results do not include operations from South Street Financial, which BNC acquired earlier this year. The deal with the parent company of Home Savings of Albemarle closed April 1. The bank spent about $800,000 on transaction-related expenses in the quarter.

Friday, April 25, 2014

Bank of America's new post designed to further 'simplify' the company

As it continues to look for ways to cut costs in a weak revenue environment for banks, Charlotte-based Bank of America said it has created a new role designed to further simplify the company.

Terry Laughlin, the bank's chief risk officer, who had split time between Charlotte and New York, has been named to the new post: strategic initiatives president.

The bank said Laughlin will oversee an initiative called Simplify and Improve, which is also designed to simplify work flow and find ways to invest in the company's operating platform.

His appointment comes three years after the announcement of the companywide cost-cutting and simplification program known as Project New BAC, a plan that calls for the bank to save $8 billion a year by mid-2015.

Laughlin's appointment builds on Project New BAC, the bank said. Since announcing Project New BAC, it has cut tens of thousands of employees and hundreds of branches.

But legal costs continue to weigh on the bank's earnings, and revenue growth remains tough for it and many other banks.

In the first quarter of this year, the bank lost $276 million, or 5 cents per share, as it recorded $6 billion in legal expenses. Revenue in the first quarter was lower than the same quarter last year.

Geoffrey Greener, who had been responsible for making sure the bank met regulatory capital requirements, has been named the bank's new chief risk officer, which means he is now part of the senior management team.

Thursday, April 24, 2014

Yadkin Financial profit narrows on merger expenses

Yadkin Financial Corp. said Thursday that it earned $3.3 million for shareholders in the first quarter, down 21 percent from the year before as the bank spends money to carry out an upcoming merger.

Yadkin announced in January that it planned to merge with Raleigh-based VantageSouth Bancshares in a deal that would create North Carolina's largest community bank.

The bank said merger-related expenses totaled $1.4 million in the quarter. The merger is still expected to close in the third quarter.

Yadkin is based in Elkin but has the largest concentration of branches in the Charlotte area and north along the Interstate 77 corridor. 

CEO Joe Towell said in a statement that loan demand is increasing in its markets. He said the bank is "excited" about its new small business loan program that cuts out paperwork and financial statement requirements to speed the process. Yadkin's loan book increased for the fourth consecutive quarter, up about 2 percent from the quarter before to $1.4 billion.

Park Sterling rolls out 'photo bill pay' in upgraded app

Charlotte-based Park Sterling Bank said Thursday it has upgraded its mobile app, which now gives customers the option to pay bills with a smartphone camera as well as turn debit cards on and off.

The bank said it is the only bank offering the mobile photo bill pay option in its markets. The bank has branches in the Carolinas and north Georgia and a loan-production  office  in  the  Richmond, Va., region.

Park Sterling also said it is one of a few banks its size in the U.S. to offer mobile photo bill pay. Customers using the app's feature take a photo of a bill statement, approve the amount and then submit the payment. The process is similar to mobile check depositing, a feature that can be found on many banks' mobile apps.

In an interview, CEO Jim Cherry called the ability to use a smartphone to take a photo of a bill and make a payment "the big missing piece to really making mobile banking a bank in your pocket."

The app's other new feature allows debit card users to turn their cards off and on. In a press release, the bank said customers can use the feature to turn off a card that has gone missing or temporarily deactivate it card between transactions, "significantly decreasing the chances of the card being used fraudulently."

Park Sterling, launched in 2006, is the largest regional bank headquartered in Charlotte. The bank has been steadily growing, expanding into Virginia this year. Cherry said the enhancements to the app are part of the bank's strategy to compete with larger peers as it expands into new markets.

"This allows us to play bigger than our footprint in markets," he said. "If you want to both survive and prosper you're going to have to find ways to continue to meet emerging customer needs."

This is the second upgrade to the mobile app since it was launched last year. The initial app allowed customers to get account balances, transfer funds and find branches, among other things. The first upgrade added remote deposit capture.

The bank also reported first-quarter earnings Thursday.

Wednesday, April 23, 2014

Wells Fargo's investment banking, capital markets head now based in Charlotte

A management reshuffle within Wells Fargo has resulted in a Charlotte executive becoming the sole head of the bank's investment banking and capital markets operation.

Robert Engel had been co-head of investment banking and capital markets, a duty he shared with New York-based Jonathan Weiss. On Wednesday, the bank named Weiss to head Wells Fargo Securities, replacing John Shrewsberry, who earlier this month was named the bank's new chief financial officer.

Engel joined Wells Fargo in 2005 as head of mergers and acquisitions. He is among other senior Wells Fargo Securities executives in Charlotte who will now report to Weiss.

Wells Fargo Securities is focused on offering products and services to medium and large corporate clients. Some of those services include mergers and acquisitions advice, debt underwriting and sales and trading activities with institutional clients, such as pension funds.

Weiss will report to outgoing CFO Tim Sloan, who next month becomes the bank's new head of wholesale banking.

Wells Fargo accepts LEED certifications for 2 uptown buildings

Wells Fargo accepted Leadership in Energy and Environmental Design certifications for Duke Energy Center and Three Wells Fargo Center during a ceremony Wednesday.

Wells Fargo owns the two uptown Charlotte towers, which were awarded LEED operations-and-maintenance certification for existing buildings.

The buildings received the certifications in August. Under a program of the nonprofit U.S. Green Building Council, LEED certifications are granted to "green" homes, neighborhoods and buildings. Certifications come in four levels: certified, silver, gold and -- the highest -- platinum.

Duke Energy Center was awarded platinum certification after receiving 81 of 110 possible points. Three Wells Fargo Center was awarded gold certification after receiving 60 points.

Wells Fargo has offices in Three Wells Fargo Center. The bank also has offices in Duke Energy Center, which is the headquarters for Duke Energy. Three Wells Fargo was built in 1999; Duke Energy Center, 2009.

It's not the only LEED certifications for the buildings. Duke Energy Center has other platinum certifications, and the Wells Fargo history museum in Three Wells Fargo Center has a gold certification that applies to its interior.

Emily Scofield, executive director of the U.S. Green Building Council's North Carolina chapter, said Wednesday the Duke Energy Center's three platinum LEED certifications make it "one of the most decorated" LEED buildings in the world. She said the state has had 568 properties certified since LEED was launched in 2000.

Wells Fargo accepted the awards at 2:30 p.m. at the Duke Energy Center.

Tuesday, April 22, 2014

Tree.com considering adding small-business loans to lineup

The parent company of LendingTree, known for matching people shopping for mortgages with lenders, is considering adding small-business loans to its lineup, its CEO said Tuesday.

Doug Lebda said it would mark the first time Ballantyne-based Tree.com has matched lenders and small businesses.

"We're taking a hard look at small-business loans," he said.

The move comes as Tree.com continues to diversify its offerings to consumers. LendingTree was founded in 1996 to help consumers comparison-shop for mortgages. Today, Tree.com's websites allow consumers to shop for personal and auto loans, online degrees and plumbers and other types of home professionals.

Last year, the company began allowing consumers to shop for reverse mortgages on Lendingtree.com. Also last year, the company added the ability to comparison shop for credit cards, and it relaunched its personal loan product.

Mortgage products still generate the lion’s share of revenue for the company.

Dixon Hughes Goodman names new CEO

Charlotte-based accounting and advisory firm Dixon Hughes Goodman said Tuesday that it has named Matt Snow as its CEO, effective June 1.

Snow had previously been managing partner for the Charlotte region. In his time at the company, he's shepherded 100 new positions in Charlotte and extended the services the advisory division provides.

“I am humbled and honored to be given this opportunity. I couldn’t be more excited about where we are heading as a firm,” Snow said in a statement. “I’ve been in this career my whole working life, and since joining the firm seven years ago, these have been the best years of my professional career."

Dixon Hughes Goodman has more than 1,800 employees across 11 states and is one of the largest accounting and advisory firms in the country. Snow said he plans to spend the first 90 days as chief executive traveling to the firm's different offices to get to know the markets.

Monday, April 21, 2014

Aquesta Financial increases profit in first quarter

Cornelius-based Aquesta Financial Holdings said Monday that it made $428,000 in the first quarter, up 23 percent from the same time period a year ago.

The bank grew its loan book and overall assets. CEO Jim Engel said the results were also boosted by strong earnings in its insurance subsidiary.

Aquesta has spent the last two years expanding its branch network and beginning to offer dividends to investors. Engel has likened the strategy shift to moving from "defense" to "offense."

"This change in focus, while maintaining good asset quality, is allowing Aquesta to capture market share to the benefit of our customers," Engel said in a statement Monday.

The company had been known simply as Aquesta Bank before forming a holding company last month.

Friday, April 18, 2014

Coastal Federal ranks highest for checking account interest rates in Meck

Coastal Federal Credit Union pays the highest checking account interest rate among all banks with locations in Mecklenburg County, according to a ranking released Friday by GoBankingRates.com.

Raleigh-based Coastal earned the top spot in the county with its 2.01 percent rate for its Go Green account. The account pays that rate for customers who use their debit card at least 30 times a month.

The website also said the average checking account interest rate in Charlotte is 0.18 percent, which is slightly higher than the national average of 0.17 percent.

But the rise in U.S. interest rates -- such as higher mortgage rates -- is not being felt in deposit accounts, the website says. Compared with a year ago, checking account rates have posted a decline of 0.02 percent.

On a national level, credit unions offer higher interest rates than banks on average, the website also found. The average among credit unions is 0.31 percent compared with 0.16 percent for banks. Community banks, though, pay the highest interest rates available in U.S. today.

Here's a look at the nine other banks that making up the top 10 paying the highest checking account interest rates in Mecklenburg County:

  • Aquesta Bank, Flagship Checking, 0.85 percent
  • BlueHarbor Bank, Neon Blue Checking, 0.85 percent
  • CommunityOne Bank, eRewards, 0.8 percent
  • Bank of the Ozarks, MaxYield Checking, 0.55 percent
  • Fifth Third Bank, Fifth Third Preferred Checking, 0.46 percent
  • Peoples Bank, Rewards Checking, 0.4 percent
  • NewDominion Bank, First Rate Checking, 0.15 percent
  • BlueHarbor Bank, Interest Checking, 0.1 percent
  • Charlotte Metro Credit Union, Premier Checking Account, 0.1 percent

Wednesday, April 16, 2014

6 takeaways from Bank of America's 1Q earnings

Bank of America reported first-quarter financial results Wednesday, becoming the fourth major U.S. bank to do so.

The Charlotte-based bank lost $276 million, or 5 cents per share, as $6 billion in legal expenses weighed on its earnings. In the first quarter of last year, it reported  profit of $1.5 billion.

Below are six key takeaways from its quarterly results and conference call.

1. LEGAL COSTS STILL AN ISSUE.

The bank continues to grapple with legal expenses nearly six years after the financial crisis.

In the first quarter, the bank reached a $9.3 billion settlement with the Federal Housing Finance Agency over alleged violations of securities laws in connection with residential mortgage-backed securities. On a call with reporters, Chief Financial Officer Bruce Thompson said the settlement contributed $3.6 billion of the $6 billion in legal costs the bank reported in the quarter.

Later in the morning, during a call with analysts, Thompson said future litigation costs for the bank will be "very hard to predict.”

Also Wednesday, the bank announced a settlement of up to $950 million with bond insurer Financial Guaranty Insurance Co., as well as separate settlements with Bank of New York Mellon Corp., over mortgage-backed securities that FGIC insured.

2. BANK VAGUE ON LEGAL RESERVES

On the call, analysts wanted to know why the bank increased its reserves -- the funds it puts aside to cover legal expenses -- by $2.4 billion, a figure that surprised some analysts. The amount is what made up the balance of the bank's $6 billion in legal costs for the quarter.

But the bank's executives declined to go into detail.

Thompson described the bump in reserves as necessary to cover "previously disclosed legacy mortgage-related matters," but he really didn't say much beyond that.

3. HEADCOUNT STILL SHRINKING

Bank of America disclosed Wednesday that its employment fell to 238,560 in the first quarter, down 9 percent, or 24,252 full-time equivalents, from a year ago.

The majority of those cuts have stemmed from the bank reducing staff that handled its troubled-loan portfolio, which the bank has continued to shrink. Many of those loans came from its 2008 acquisition of subprime lender Countrywide Financial Corp. Some of those job cuts have affected Charlotte.

4. BRANCH AND ATM NUMBERS SHRINKING, TOO

Bank of America’s branch count has fallen by 605 since 2011, when it announced a massive cost-cutting plan called Project New BAC. It has shed 1,586 automated teller machines over the same period.

That leaves the bank with 5,095 branches and 16,214 ATMs.

Moynihan indicated Wednesday that the branch count could come down further.

"We will adjust," he said in response to an analyst who asked whether more cuts are coming.

5. MOBILE BANKING ON THE RISE

While the number of branches and ATMs is falling, the bank's number of mobile-banking customers keeps rising. Such customers grew 19 percent in the first quarter from a year ago to 15 million, the bank said.

The bank said about 10 percent of the deposits its customers make are done via mobile devices. Thanks to smartphones, Moynihan said, "people effectively carry a branch in their pocket."

6. MORTGAGE BUSINESS DOWN BUT MIGHT BE POISED FOR PICKUP

It came as no surprise that the bank's mortgage business was down dramatically from a year ago, as other banks have also seen mortgage declines thanks to less refinancing activity. Demand to refinance has waned as mortgage rates have risen in the past year. That has sent some banks scurrying to find replacement revenue.

Bank of America's mortgage business earned $412 million in the first quarter, down 67.4 percent from $1.26 billion a year ago. In some good news, its so-called "pipeline" of new mortgages rose 23 percent in the quarter from the fourth quarter of last year.

The uptick is not all that surprising, as home sales tend to rise in the spring.

Movement Mortgage names Laura Bowles as CFO

Laura Bowles, daughter-in-law of former University of North Carolina system president Erskine Bowles, has been named chief financial officer of Movement Mortgage.

The company made the announcement Wednesday, although Bowles' first day was March 1.

Bowles becomes the first CFO for the company, which was co-founded in Charlotte in 2008 by ex-Carolina Panther Casey Crawford. Before her hire, Crawford, the company's CEO, said he had been handling CFO duties.

Bowles is a former executive for Citibank, where she was director and head of consumer and small business lending products. She has also worked as a risk manager for Bank of America and as a chief financial officer for Wachovia.

Bowles' hire comes as Crawford is pushing for the company to become the largest privately held mortgage lender in the U.S. Over the next 10 years, Crawford expects Movement Mortgage to be closing one out of every 10 loans for home purchases, he said.

The company is now headquartered in Virginia Beach, Va., and has roughly 1,200 employees. Approximately 250 are in Charlotte, Crawford said.

Tuesday, April 15, 2014

Bank of Commerce earnings hit by preferred stock repricing

Charlotte-based Bank of Commerce's net income to shareholders fell in the first quarter despite loan and deposit growth as preferred stock originally stemming from the federal Troubled Asset Relief Program became more expensive.

The bank's net income to shareholders fell to $62,000, down 10 percent from the year before. Before the impact of Bank of Commerce's preferred stock payments, however, net income rose 15 percent to $135,000.

The preferred stock became more expensive as a function of how the U.S. Treasury structured the federal bank bailout program in 2008 and 2009. The government required an annual interest payment that would jump from 5 percent to 9 percent after five years. That time period has now arrived for most of the community banks who still have the investments on their books.

The price change remains in effect even if the bank's preferred stock has been sold to private investors. Bank of Commerce's TARP investment was auctioned off in 2012.

Last month, Bank of Commerce agreed to be sold to Asheville's HomeTrust Bancshares. CEO Wes Sturges cited regulatory pressure and the impending repricing of the preferred stock as factors.

Monday, April 14, 2014

Richmond Fed has new Charlotte board member

The Board of Governors of the Federal Reserve System named a new member to its Charlotte board of directors on Monday.

Laura Clark will serve a term that runs until Dec. 31, 2015. Clark is executive director of Renaissance West Community Initiative, a Charlotte-based nonprofit revitalizing the old Boulevard Homes on the west side of Charlotte.

Clark fills the seat that had been held by David Zimmerman, president of Charlotte-based Southern Shows Inc., a trade and exposition management company. Zimmerman's term expired Dec. 31.

The Charlotte board of directors falls under the Federal Reserve Bank of Richmond, which also has a Baltimore branch and board of directors.

The boards of the Baltimore and Charlotte branches each have seven members, three of whom are appointed by the Board of Governors and four by the directors of the Federal Reserve Bank of Richmond.

Thursday, April 10, 2014

U.S. attorney presses on with BofA case

Two weeks after a magistrate judge recommended dismissal of a U.S. mortgage securities case against Bank of America, federal prosecutors in Charlotte filed a motion asking for the recommendation to be set aside.

The case involves a pool of prime mortgages Bank of America packaged and sold to investors. The U.S. Attorneys Office for the Western District of North Carolina filed suit in August claiming the Charlotte bank misled its clients on how risky the loans really were.

A magistrate judge ruled in late March that the laws the government sued under didn't apply in the case. In Thursday's filing, prosecutors argue that the judge's decision contains errors. The U.S. attorney's office also points out that the merits of the case haven't been ruled on.

Wednesday, April 9, 2014

Chanticleer Holdings to buy building for 6th South African Hooters

Charlotte investment company Chanticleer Holdings said it has entered into an agreement to buy a building that will become its sixth Hooters location in South Africa.

The company made the disclosure in a regulatory filing this week.

Chanticleer said its subsidiary, Hooters SA, entered into the agreement to buy the 15,446 building from Leverage Trust. The purchase price is 5 million rand, the currency in South Africa. As of Wednesday, that amounted to about $481,025.

Closing of the purchase is expected to occur in eight to 10 weeks.

Tuesday, April 8, 2014

Report: On percentage basis, BofA dividend growth leads

Bank of America's dividend is a far cry from what it was before the financial crisis.

But the bank's announcement last month that it is raising the quarterly payout from a meager 1 cent to 5 cents puts it among stocks that will see the largest dividend jumps on a percentage basis this year, says Forbes, citing a report from financial information firm Markit.

The Charlotte-based bank, Starwood Hotels and construction material producer Vulcan Materials are among stocks poised to hike their dividends by 200 percent or more.

Of course, with Bank of America's dividend starting so low, it doesn't take much of an increase to equate to a large percentage growth.  

Last month, Bank of America announced plans to increase its dividend for the first time since the financial crisis. The news came after the bank won approval for the dividend increase from the Federal Reserve.

Like other major banks in the wake of the crisis, Bank of America must receive approval each year from the Fed before raising its dividend or buying back stocks. The Fed in 2011 rejected the bank’s plan for a dividend increase in the second half of that year. Until this year's request, that was the only time since the crisis that the bank asked the Fed for a dividend hike.

Even at 5 cents per quarter, Bank of America's dividend is small when compared with that of its peer banks. For example, San Francisco-based Wells Fargo said last month the Fed has OK'd its plan to raise its quarterly dividend from 30 cents a share to 35 cents.

Many longtime Bank of America shareholders remain frustrated that the bank's dividend has been so low since the crisis. As recently as 2008, the quarterly dividend was 64 cents per share.

Friday, April 4, 2014

Chanticleer Holdings' settlement with investors in federal court's hands

An $850,000 class-action settlement agreement involving Chanticleer Holdings and investors who claimed the company misled them has been filed in federal court, according to documents released Friday

The Charlotte-based investment company, which owns and operates restaurants, including Hooters, said a motion seeking preliminary approval for the cash settlement was filed Monday in U.S. district court in south Florida.

The accord would resolve claims stemming from an investor lawsuit filed over a June 2012 offering of 2.4 million Chanticleer shares. The suit says Chanticleer misled investors in offering documents for the securities by claiming that financial statements for its South African Hooters operations had been audited.

Three months later, in September 2012, Chanticleer informed the U.S. Securities and Exchange Commission that financial statements for the South African operations had not been audited. Nasdaq then halted trading of the Chanticleer's stock, “rendering it nearly worthless,” the lawsuit says.

Settlement negotiations began in December, according to securities filings. Under the settlement's terms, Chanticleer’s insurer, XL Specialty Insurance Co., will pay $837,500. Chanticleer's accounting firm, Creason & Associates, which audited financial statements used in the 2012 stock offering, will pay $12,500.

“We are pleased with this agreement, which will put this matter behind us, so that we may focus our attention on growth,” Mike Pruitt, CEO of Chanticleer Holdings, said in a statement.

Thursday, April 3, 2014

Bank of America close to settling over credit card add-ons, reports say

Bank of America is close to reaching a settlement with a U.S. regulator over products it sold as add-ons to credit cards, according to news reports Thursday.

The Wall Street Journal, citing people familiar with the matter, reported that the bank is in talks to pay more than $800 million to settle with the Consumer Financial Protection Bureau. The settlement would be the CFPB's largest ever with a financial institution, the WSJ reported. A deal could be announced in the coming days, according to the story.

A spokesman for the CFPB declined to comment when reached by the Observer. A Bank of America spokeswoman also declined to comment.

The Charlotte bank has been under scrutiny over the sale and marketing of credit card products that offered consumers debt cancelation in the event of a hardship like a job loss and identity-theft protection.

Bank of America no longer offers the products.

In January 2013, a judge approved a $20 million settlement to compensate customers who bought Bank of America's Credit Protection Plus product. Customers paid monthly fees in exchange for credit card payments being canceled in the event of a job loss or other hardship. The settlement affects customers who claimed, among other things, that they were signed up for the product without their consent or that the product was not as advertised.

In an August securities filing, the bank disclosed that it has been in talks with regulators to "address concerns" about the sale and marketing of credit card debt-cancellation products.

In a filing in 2012, the bank said regulators were looking at its identity theft-protection services. Regulators were interested in "customers who may have paid for but did not receive certain of such services from third-party vendors" of the bank and "whether appropriate oversight existed."

Robert Pittenger wants more voice for small businesses affected by regs

Rep. Robert Pittenger said Thursday that he is hoping to create an advisory board that will allow small businesses to have input on financial regulations that could negatively affect them.

Pittenger, a first-term Republican whose district includes part of Mecklenburg County, on Thursday afternoon plans to introduce legislation to establish the board, which would advise the Consumer Financial Protection Bureau.

Pittenger will jointly introduce the bill with Rep. Denny Heck, a Democrat from Washington state, according to Pittenger’s office.

The bureau is a federal agency created by Congress in response to the financial crisis. Since its creation, the agency has issued rules designed to strengthen protections for consumers. In January, for example, CFPB rules took effect requiring mortgage lenders to ensure borrowers have the ability to repay.

But small businesses in financial services have no “regular advocate” at the CFPB, “meaning new regulations can be developed without considering how they negatively impact small business owners and employees,” Pittenger’s office says in a press release, an advance copy of which was obtained by the Observer. “Large banks already have the privilege of regular interaction with CFPB decision-makers.”

According to a draft of the legislation, it would require the director of the CFPB to establish the board and appoint its members. The board will be made of at least 12 members who will represent small businesses that provide financial products or services to consumers “primarily for personal, family or household purposes.”

The CFPB already has a process in place to hear the concerns of small businesses. Through meetings of the Small Business Review Panel, the CFPB can gather input from small businesses that are likely to be directly affected by regulations it might issue, according to a fact sheet.

Pittenger’s office points out that the Small Business Review Panel is convened only at the discretion of the CFPB. By contrast, Pittenger's proposed advisory board would be a permanent fixture and meet on a regular basis, his office said. The legislation calls for the board to meet at least twice a year.

“As a former small business owner, I understand the frustration of watching Washington bureaucrats make rules that needlessly and negatively impacted my business,” Pittenger says in the press release. “This common sense, bipartisan legislation will give small business owners a seat at the table.”

A CFPB spokesman said the bureau generally does not comment on proposed or pending legislation.

Tuesday, April 1, 2014

NewDominion Bank stock value rising

A year ago, NewDominion Bank finished a capital raise that put the Charlotte community bank back on solid footing. Bank executives say now it's started to pay off for those new stockholders.

The bank raised $10.5 million from about 260 investors, with an average investment of $40,000. Shares sold for 50 cents each, a heavy discount from the original capital raised when the bank was founded in 2004.

But NewDominion wrote shareholders this week to let them know that a third-party adviser has come in and valued the bank's common stock at 74 cents per share, a 48 percent increase.

"This valuation serves as one of many indications that we are headed in the right direction," CEO John Hipp wrote in the letter.

Wells Fargo getting a new CFO

The current head of Wells Fargo Securities will become the bank's new chief financial officer next month, Wells said Tuesday. It's part of a management shuffle as a long-time executive retires.

John Shrewsberry will take over the post from Tim Sloan, who's been Wells Fargo's CFO since 2011. Sloan is moving over to manage the wholesale banking business, which covers commercial banking, asset management, insurance and capital markets.

David Hoyt, who led wholesale banking for the last 16 years, is retiring after three decades at Wells Fargo.

Chanticleer Holdings reports larger loss in 4Q

Charlotte-based investment company Chanticleer Holdings lost $2.3 million in the fourth quarter of last year, or 61 cents a share, the company reported in a regulatory filing. A year ago, the company reported a loss of $879,000, or 24 cents a share.

The larger loss came as the company reported higher operating expenses for its restaurants. Payroll and occupancy costs for its restaurants were both higher, Chanticleer said.

Last year, the company, whose focus had been solely on owning and operating Hooters in other countries, began investing in other restaurant brands. During the quarter, the company bought a Hooters in England and a majority interest in the Charlotte-based Just Fresh restaurant chain. It also opened its fifth Hooters in South Africa in the quarter.

Restaurant operating expenses for the fourth quarter were $2.1 million, or 63.3 percent of restaurant revenue. That was up from restaurant operating expenses of $1.1 million, or 58.7 percent of restaurant revenue, a year ago.

Revenue for the fourth quarter was $3.3 million, up from $2 million a year ago. The higher revenue was the result of the restaurants Chanticleer opened or acquired, the company said.

For the full year, the company reported a net loss of $5.2 million, or $1.19 a share, up from a loss of $3.2 million, or $1.13 per share, in 2012.

In the same regulatory filing, the company said a Just Fresh location will open in the new Charlotte Knights BB&T Ballpark. The restaurant will open April 11, Chanticleer said. It will be the chain's sixth location, the company said.

Yadkin Bank makes push on small loans

Yadkin Bank said Tuesday it has developed a program to quickly make small loans to business customers, joining the fray of community banks competing for a piece of that market. In some cases, the bank won't ask to look at financial statements.

Called "Business Express," the program will make decisions on loans smaller than $250,000 in as quickly as the same business day. Yadkin Bank also says it has cut down on the paperwork required. No financial statements are required for loans less than $50,000.

Yadkin Bank's initiative comes as banks both large and small have pressed harder into small business lending. NewDominion Bank has also created a program to make decisions on most loans within 48 hours. Bank of America and Wells Fargo have also added bankers to handle small business customers.

BNC Bancorp completes acquisition of South Street Financial

The parent company of Bank of North Carolina said Tuesday that it has completed its acquisition of South Street Financial Corp., a $26 million deal that gives BNC Bancorp a deeper presence in the Charlotte area.

BNC announced the deal to acquire the parent company of Home Savings Bank of Albemarle in December. The bank has about $278 million in assets and $235 million in deposits primarily in Stanly and Montgomery counties.

Its branches will keep the Home Savings Bank name until June, when the conversion is complete, BNC said Tuesday.