Tuesday, December 31, 2013

5 biggest Charlotte finance stories of 2013

The year 2013 marked another period of rapid change for Charlotte bankers and financiers. Here's a look at the five biggest stories that impacted the local financial scene this year.

1) Mortgage rates spur hundreds of layoffs. For two years, mortgage rates had been at rock-bottom to try to jump-start the housing market, leading people to refinance by the thousands. But in the spring, those interest rates began to climb. Lenders big and small who had brought on workers to deal with the flood of loan applications found themselves with too many people and too little work -- sparking round after round of layoffs.

Wells Fargo fired more than 400 mortgage processors in Charlotte and 5,000 around the country. Bank of America laid off at least 3,000, with an unknown number in Charlotte. Fifth Third and SunTrust cut staff. Smaller mortgage companies weren't spared, either.

2) Private equity buys Charlotte homes by the thousands. Lured by low housing prices in a weakened market, Wall Street firms began to buy up single-family homes to turn them into rentals -- and made Charlotte a prime location. By the summer, one in every five homes sold in the Charlotte area was bought by an investor, the second-highest rate in the country. But their entry also proved jarring for tenants. As they took over ownership, the companies began evicting people at a disproportionately high rate, an Observer investigation found.

3) Bank of America, Wells Fargo settle more than $18 billion in lawsuits. The legal morass that has consumed the last few years at Charlotte's big banks continued through 2013 in a steady stream of settlements both big and small. The biggest came in January, when Bank of America agreed to a $10 billion settlement with Fannie Mae over bad mortgages sold to the government-sponsored entity. And it's not over yet. Bank of America has several major legal issues still to be resolved.

4) Bank consolidation comes to Charlotte in a big way. Bankers have been talking about it for years, but the long-predicted wave of mergers and acquisitions seemed to finally come to pass in 2013. North Carolina shed banks at the fastest rate in two decades as banks big and small made deals.

To name a few: First Citizens Bancshares Inc. acquired Mountain 1st Bank and Trust, Bank of the Ozarks bought First National Bank of Shelby, NewBridge Bancorp bought CapStone Bank, and Bank of North Carolina bought at least two more. Bank executives say more is yet to come.

Read more here: http://obsbankwatch.blogspot.com/2013/11/nc-sheds-banks-at-fastest-pace-in-two.html#storylink=cpy

5) Boutique investment banking scene shifts. Charlotte has become a hot spot for middle-market investment banking, and the local scene brought in two big buyers in 2013. Deloitte Capital Finance said in June it would buy McColl Partners, the investment bank co-founded by former Bank of America CEO Hugh McColl that had about 70 professionals.

Later that same month, Minneapolis-based Piper Jaffray acquired Charlotte's Edgeview Partners. In the fall, the whole local investment banking community got together as the leaders of the old Bowles, Hollowell, Conner & Co. got back on stage together.

Think I missed something important? Drop me a line at adunn@charlotteobserver.com.

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N.C. brewery is now publicly traded

A growing craft brewery in Boone is now a publicly traded company, and it hopes to use the new access to capital to spread its beer across the state.

Usually when you hear of a business going public, it's because the company issued shares for the first time in an initial public offering. But Appalachian Mountain Brewery took the lesser-known step of scooping up a tiny publicly traded firm and taking its place on the stock exchange.

The brewery said this month that it had acquired North Carolina Natural Energy Inc (ticker: NCNE), which trades over the counter, in a $3.5 million deal. That company is no longer in operation, and Appalachian Mountain Brewery has filed paperwork to formally change its name and ticker symbol to reflect its new owner.

Why go this somewhat unusual route? CEO Sean Spiegelman told the Observer that his brewery wanted to raise money to build a new distribution center and restaurant, get its beers into more stores and start brewing hard ciders and sour beers.

Traditionally, a small company in this position will take on an outside investor to get the capital. But Spiegelman said he didn't want to give up the equity in the business that would require. And since his father spent 30 years as an options trader on Wall Street, he said he knew this could be a good avenue to explore.

Appalachian Mountain Brewery's beers aren't in Charlotte yet, but they might be soon. Spigelman said he's already in talks with a distributor to get beers in the Charlotte and Raleigh metro areas. The CEO of Charlotte-based Chanticleer Holdings, Mike Pruitt, is also a shareholder, and said the beers could soon make it into restaurants his company controls -- like American Roadside Burgers.

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Monday, December 30, 2013

Bank of America launches social impact financing

Bank of America said Monday that it has launched its first "social impact partnership" with the state of New York, joining Wall Street's biggest banks in the innovative nonprofit funding model.

How it works: Bank of America Merrill Lynch raised $13.5 million from high-net-worth customers and institutional investors. The money is going to Center for Employment Opportunities, an established New York nonprofit that trains inmates in NYC and Rochester for employment.

They'll work with 2,000 inmates over four years. If the nonprofit is successful in its goals, such as reducing recidivism, the U.S. Department of Labor and the state of New York will pay back Bank of America's investors. The program is also known as "Pay for Success."

The Observer first reported that Bank of America was eyeing this type of financing program. At the time, New York City had recently announced the first social impact financing project in the country, with Goldman Sachs. They're viewed as a cost-saving way for governments to fund social programs.

The "Pay for Success" program marks the second socially conscious new investment Bank of America has announced in as many months. In November, the bank said it had issued a $500 million "green bond," with proceeds going to fund sustainable energy projects.

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Yadkin Bank director resigns after disagreement with management

Long-time Yadkin Financial Corp. director James N. Smoak is leaving the bank's board after a disagreement with bank management over their growth strategy, according to a securities filing. Smoak had been on the Elkin-based bank's board since 1987, and served as CEO of the bank from 1997 until retiring in 2002.

After several years of struggling, including layoffs, branch closings and a capital raise to swallow a major asset write-down, Yadkin Financial executives said over the summer that the bank plans to double loan production.

Yadkin Bank CEO Joe Towell declined to comment. Smoak did not return a phone call seeking comment.

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Wells Fargo's sales culture pressures workers, irks customers

Under pressure to meet quotas on new credit cards issued or checking accounts opened, Wells Fargo employees have sometimes resorted to fraudulently signing paperwork or creating unneeded accounts, a Los Angeles Times investigation finds. In one case, a homeless woman was talked into opening six new accounts that brought fees of $39 a month.

It all stems from Wells Fargo's pride in "cross-selling," or trying to get as many of the bank's products as it can into each customer's hands. Executives have repeatedly said that they only do what is best for the customer. But the current and former employees the Times spoke to said that they felt pressure to juice the numbers because if quotas weren't met, they'd be forced to stay for late-night or weekend call sessions -- and ultimately be fired.

There is some evidence that complaints like these have eroded Wells Fargo's customer service rankings. The bank fell from the top spot in two prime measures of customer satisfaction in the past year. Former employees have told the Observer that the bank often placed sales goals over personal service.

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Friday, December 27, 2013

Aquesta Bank breaks ground on Huntersville branch

Aquesta Bank has broken ground on its first branch in Huntersville as the bank continues its expansion in the communities north of Charlotte.

The Cornelius-based bank already has branches in Cornelius, Davidson, and two in Mooresville. Executives had been scouting for a location in Huntersville since at least May. The new branch will be built off Sam Furr Road in the Northcross Shopping Center.

“This site is convenient for many of our current customers but also highly visible and should help us attract and service new banking relationships," CEO Jim Engel said in a statement. “As Huntersville continues to grow we intend to grow with it by providing unexpected convenience and unsurpassed personal service as only a true community bank can do.”

Aquesta Bank's new branch will be just more than 3,000 square feet and include three tellers, drive-throughs, a kitchen and a community room groups will be able to reserve for free. The branch is slated to open in the spring.

It's the second new branch to begin construction in the town in as many months. In November, Truliant Federal Credit Union broke ground on its new branch in Huntersville.

Appearing in Aquesta Bank's photo at last week's groundbreaking, from left to right:
  • Roger Layman, architect
  • David Goodrum, general contractor
  • Denis Bilodeau, president of Aquesta Insurance Services
  • Jill Swain, Huntersville mayor
  • Bill Russell, president of the Lake Norman Chamber of Commerce
  • Jim Engel, Aquesta Bank CEO
  • Charles Knox, Aquesta Bank chairman
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Read more here: http://obsbankwatch.blogspot.com/2013/11/truliant-building-huntersville-branch.html#storylink=cpy

Friday, December 20, 2013

First Union alum to leave CommunityOne board

Long-time First Union executive Louis A. "Jerry" Schmitt is stepping down from CommunityOne Bancorp's board of directors, the Charlotte bank said Friday.

Schmitt, 73, was executive vice president and co-head of First Union's capital markets division in the mid-1990s. His co-head? Ken Thompson, who later became CEO of First Union and then Wachovia after the Charlotte bank bought it.

He had served on CommunityOne's board since it was saved from the brink of failure in a $310 million recapitalization in 2011. That's also when Brian Simpson and Bob Reid were brought in as CEO and president, respectively. Both Simpson and Reid were executives at First Union and later Wachovia.

The announcement from CommunityOne points out that Schmitt's retirement was not because of a disagreement with the bank.

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Ally settles claims it discriminated against minorities

Ally Financial will pay $98 million to settle claims that it discriminated against minority car loan borrowers between April 2011 and this month. It marks the largest auto loan discrimination settlement in history.

The federal Consumer Financial Protection Bureau and U.S. Department of Justice said that more than 235,000 black, Hispanic and Asian borrowers were pushed into higher-cost loans.

The disparity stems from Ally's practice of setting a risk-based interest rate on car loans, and then allowing the dealer to mark up the price based on its discretion. The bank and the dealer then share the profits from the mark-up. A statistical analysis found that minority borrowers disproportionately had higher mark-ups.

Ally employs several hundred people in a namesake office tower uptown.

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Thursday, December 19, 2013

Chanticleer Holdings agrees to $850,000 settlement with investors

An $850,000 class-action settlement involving Chanticleer Holdings has been reached in a lawsuit filed by shareholders who claim the company misled them in documents for a public offering of stock.

According to a Wednesday court filing, Chanticleer’s insurer will pay $837,500 of the settlement amount. Chanticleer's accounting firm, Creason & Associates, which audited financial statements used in the stock offering, will pay the remaining $12,500.

The proposed settlement is subject to court approval.

The lawsuit was filed in federal court in Florida last year. It stems from a June 2012 offering of 2.4 million Chanticleer shares at $4.50 apiece.

The lawsuit claims offering documents contained false and misleading information about Chanticleer’s South African Hooters operation. The documents told investors that although Creason did not audit the financial statements of the South African unit other auditors had, the suit says.

Three months later, Chanticleer told the U.S. Securities and Exchange Commission that financial statements for the South African operations actually had not been audited. Following that disclosure, Nasdaq halted trading of the company’s stock, “rendering it nearly worthless,” the lawsuit says.

Additional terms of the settlement are being negotiated, according to court documents. Finalized settlement documents are expected to be drafted in the next 60 days.

“We are pleased to have reached this agreement in principal and hope to negotiate and finalize documents within the next 60 days,” Mike Pruitt, Chanticleer CEO, said in a statement Thursday.

Wednesday, December 18, 2013

Bank of North Carolina buys two more banks

The parent company of Bank of North Carolina announced Wednesday that it has bought two more banks as it deepens its expansion into the two biggest metro areas in the state.

BNC Bancorp's two deals will boost Bank of North Carolina's assets in the Charlotte and Raleigh metro areas by more than a half-billion dollars.

In the first purchase, Bank of North Carolina will acquire the parent company of Home Savings Bank of Albemarle, a $274.1 million in assets bank that also has locations in Locust and Oakboro. BNC will pay $23.7 million in a cash and stock deal, based on the bank's latest closing price.

In the second, Bank of North Carolina is buying the parent company of Harrington Bank, a $228.5 million in assets bank located in Chapel Hill and Durham. BNC will pay $24.2 million in cash and stock.

"Both companies are important additions with different dynamics that address BNC’s long term strategy of building one of the premier franchises in the Carolinas and Virginia," CEO Rick Callicut said in a statement.

The acquisitions still need regulatory approval. Callicut said he expects them to be finalized by the third quarter of 2014.

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Paragon bank rolls out new logo, website

Raleigh-based Paragon Bank on Wednesday unveiled a new logo and website as part of a strategy to draw more attention to its private-banking services.

The move comes after the 14-year-old bank earlier this year changed its name from Paragon Commercial Bank in an effort to make potential customers think of it as more than a lender to businesses.

"Paragon Bank has unveiled a refreshed brand to highlight the bank’s high-touch private banking approach to serving business and individual clients," the company said in a statement. "The brand refresh arrives as many banks scale back branching strategies, increase fees and reduce staffing, which has a negative impact on their customers."

The bank is taking other steps to raise its visibility. It is moving from office space in Piedmont Town Center to its own, standalone two-story building less than a mile away.

Initially, the bank will occupy the entire first floor and only a portion of the second floor, giving it room to make new hires, which is what it plans to do. The relocation will keep the bank in SouthPark. Its only other location is in Raleigh.

Paragon has also been busy recruiting bankers away from its larger peers in Charlotte. Last month, it announced the hiring from Wells Fargo of Salley Griffith. This month, Paragon announced the hiring from Yadkin Bank of Warren Miller. Both are now client development officers for Paragon.

Phil Jurney, Charlotte market president for Paragon, told me last week that he reached out to Griffith and Miller about a year ago to come work for his bank.

“At the end of the day, you want relationship officers that have been in the market, that know the market, that have clientele," Jurney said. "You want them to be trained. You want them to be experienced. That’s what I'm looking for every day."

He said the bank is looking to hire a credit-risk analyst and more commercial and industrial lenders and commercial real estate lenders. Paragon might also hire another deposit officer, he said.

Tuesday, December 17, 2013

Wells Fargo to show off new disaster trucks

Wells Fargo is pulling out the heavy equipment up in the University City area this week, showing off two new trucks its adding to its disaster relief fleet.

The vehicles are driven into natural disaster areas to help people get cash out when credit card systems or other banking processes are down. They'll be on display at the Wells Fargo CIC campus on West WT Harris Boulevard starting at noon Wednesday.

Four-wheel-drive Ford

Freightliner truck

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Bank of America has most collegiate credit card agreements

Bank of America has more credit card agreements in place with colleges and universities across the country, according to data published Tuesday by the Consumer Financial Protection Bureau. But the number of collegiate affinity programs it runs has shrunk by nearly two-thirds over the past two years.

Through its FIA Card Services subsidiary, Bank of America had agreements with 224 schools and their related organizations, like alumni organizations, as of the end of last year. The Charlotte bank's programs had close to a million open accounts. Bank of America paid more than $35 million to schools to secure them last year.

Just two years ago, Bank of America had more than 600 programs. Spokeswoman Betty Reiss said the bank said the affinity programs remain important to the bank's credit card business, but said the bank has "deliberately pared it back to focus on key partners with growth opportunities." The amount it's paid colleges for the programs has also shrunk, from $62 million in 2009.

Bank of America's most lucrative contract, at nearly $3 million, went to the Penn State Alumni Association. The bank paid $1.25 million for a contract with UNC-Chapel Hill's alumni organization.

The second-biggest collegiate card issuer was Capital One, with 55 agreements but only 6,000 members. JPMorgan Chase had 15 agreements, but 83,000 open accounts.

The Consumer Financial Protection Bureau disclosed the agreements as it presses banks and other issuers to share more information about its agreements with different schools. The regulator wants to post the contracts online.

“Students and their families should know if their school, whether well-intentioned or not, is being compensated to encourage students to use a specific account or card product,” director Richard Cordray said in a statement. “When financial institutions secretly give kickbacks to schools, they are engaging in risky practices.”

As part of a major regulatory overhaul aimed at protecting consumers from credit card abusers, banks are now required to disclose what agreements it has in place with schools. Some credit card issuers had been accused of using misleading tactics to get young people signed up for high-interest cards.

Bank of America pointed out that since its affinity program cards are marketed to alumni associations, the vast majority of customers are non-students. Reiss said the bank hasn't marketed credit cards on campuses in several years.

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Monday, December 16, 2013

Wells, BofA are tops in financing payday lenders

As regulators in states across the country increasingly crack down on payday loans, the big banks that finance those businesses have come under scrutiny. A report to be released today by Durham-based Reinvestment Partners finds that Wells Fargo and Bank of America are the two biggest players funding payday lenders.

Wells Fargo has provided $1.2 billion in lines of credit and other loans to companies that make payday loans, the report states -- more than any other bank. Bank of America was No. 2 with about $664 million.

Payday loans generally refer to short-term loans that carry high interest rates and fees. Companies in Reinvestment Partners study also include refund anticipation lenders, pawn shops, and rent-to-own companies.

Wells Fargo has lent money to 13 payday loan companies, including Cash America and First Cash Financial, the report says, based on securities filings made by the companies. Bank of America was connected to 11 such companies, including Advance America. Some of the companies on the lists include firms like Jackson Hewitt, which deal primarily in tax and other services but occasionally offer payday-loan-type products.

Activists have regularly criticized both banks for their financing arrangements with the payday loan companies. Several times at recent annual shareholder meetings in Charlotte, Bank of America CEO Brian Moynihan has been asked about his bank's funding of pay day loan companies. He's responded by saying the Charlotte bank does not make payday loans.


Bank of America says in a statement that it is cutting ties to the payday lending companies it once financed.

The Charlotte bank says it has not "pursued new credit relationships in the payday lending industry" for several years, and made the decision earlier this year to get out of that line of business entirely. The bank said it is ending its current relationships with such companies over time.

Wells Fargo said in a statement that the bank "provides credit to responsible companies in a variety of financial services industries." The bank regularly checks to make sure the companies it lends to are in compliance with the law.

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Friday, December 13, 2013

Charlotte investment managers charged in CDO case

The managing directors of a Charlotte investment advisory firm have been charged by the Securities and Exchange Commission for their role in a complex investment that authorities say was put together with significant conflicts of interest, the regulator announced.

Scott H. Shannon and Joseph G. Parish III will pay $472,000 and be forced to leave the industry. They accepted the settlement but did not admit to or deny the charges.

The two men managed NIR Capital Management LLC, were responsible for putting together the assets that would back a collateralized debt obligation marketed by Merrill Lynch in 2006 and 2007. The SEC says they allowed hedge fund Magnetar Capital LLC, an investor in the CDOs, to influence what assets went into them. Magnetar would later hedge its risk against the securities by shorting them.

In once case, Shannon called a mortgage-backed security included in the instrument "a real stinker," the SEC said. 

“Shannon and Parish could not serve two masters,” SEC enforcement division co-director George S. Canellos said in a statement. “They allowed Magnetar to influence asset selection and abdicated their duty to pick only the assets they believed were best for their client.”

The SEC also charged Merrill Lynch, which structured and marketed the securities. The investment bank, now owned by Bank of America, agreed to pay $132 million to resolve claims that it mislead potential investors about the independence of the people deciding what made up the CDOs.

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Deloitte, Frontier Capital lead deals

The Charlotte investment bankers at Deloitte Corporate Finance said Thursday they advised on the sale of healthcare consulting company KLMK Group from Azalea Capital to CBRE Group. Terms were not disclosed. Azalea Capital is based in Greenville, S.C.

In a separate deal,  the Charlotte private equity firm Frontier Capital said it took the lead in a $16 million Series B round for Simpli.fi, a company that helps publishers manage advertising data.

ALLIANCE BANK & TRUST INKS DEAL WITH PRIVATE ASSET MANAGER: The Gastonia community bank has made a pact with a private asset manager up the road in Belmont. R.J. Schrift Private Asset Management services will now be available to Alliance customers.

BANK ROBBERIES ON THE DECLINE: The state bankers association held its annual bank robbery awareness conference Thursday and law enforcement gave some good news -- the number of heists at North Carolina banks fell this year.

BANK OF AMERICA STADIUM HAS NEW WI-FI: There are now 645 new wireless access points in the stadium, courtesy of AT&T. An NBC Charlotte reporter shares that they're actually hidden in the handrails. Anyway, the upshot is that fans taking selfies in the back row will now be able to upload them a lot quicker. Yeah, I've done it, too.

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Thursday, December 12, 2013

Chanticleer Holdings completes purchase of Just Fresh chain

Charlotte-based investment company Chanticleer Holdings said Thursday it has completed its purchase of the Charlotte-based Just Fresh restaurant chain, in which it will own a larger majority stake than previously announced.

Chanticleer said it will have 56 percent ownership in the companies that own Just Fresh, JF Restaurants and JF Franchising Systems. That's up from 51 percent announced last month.

The purchase price is $560,000, including $434,324 to pay off the sellers' debts.

Just Fresh has five locations, all in Charlotte. According to its website, it offers a variety of “fresh, wholesome and nutritionally balanced” food.

Chanticleer CEO Mike Pruitt said last month that Chanticleer plans to open more Just Fresh locations in Charlotte and renovate the one on East Boulevard. The company is also planning to open Just Fresh locations in other countries.

This year, Chanticleer has been expanding its focus beyond owning and operating Hooters restaurants in other countries. In October, it said it completed its purchase of Charlotte-based American Roadside Burgers. Last week, it said it had signed an agreement to buy a Texas seafood restaurant. Also last week, it become an investor in a nightclub set to open in Las Vegas.

Merrill to pay $132 million over charges it misled investors

Merrill Lynch will pay $132 million to resolve charges that the firm marketed complex investments to clients using misleading information, the Securities and Exchange Commission announced.

The alleged wrongdoing took place in 2006 and 2007, before the investment  bank was acquired by Bank of America.

According to the SEC, Merrill failed to tell investors in a series of collateralized debt obligations that hedge fund Magnetar Capital LLC had a significant role in deciding what assets backed the securities. Magnetar bought into the CDOs but also hedged its risk by shorting them.

"“Investors did not have the benefit of knowing that a prominent hedge fund firm with its own interests was heavily involved behind the scenes in selecting the underlying portfolios," enforcement division co-director George S. Canellos said in a statement.
Merrill Lynch did not admit to nor deny the SEC's findings.

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Bank of America inking biggest branch deals

The last few years have been a time of paring back across Bank of America, and the Charlotte bank's national branch network has been no exception. New data released Thursday by SNL Financial shows that the bank hasn't been afraid to cut it back in large chunks.

Of the 10 biggest bank branch deals of this year, Bank of America was the seller in half of them -- including the four largest.  Those deals alone resulted in the sale of 112 branches across the country. As of the third quarter, Bank of America had about 300 fewer branches than it did last year.

The bank has been selling branches to regional players in the markets where it is scaling back. Here are the five largest deals Bank of America has announced this year:

  • 51 branches sold to Washington Federal Inc. in Seattle. The branches are in Washington, Idaho, Oregon and New Mexico.
  • 24 branches to Old National Bancorp in Evansville, Ind. Branches are in southwestern Michigan and northern Indiana.
  • 20 branches to Berkshire Hills Bancorp in Pittsfield, Mass. Branches are in Massachusetts and New York.
  • 9 branches to First Financial Corp. in Terre Haute, Ind.
  • 8 branches to Community Bank System Inc. in De Witt, N.Y. Branches are in northeastern Pennsylvania.
 While many large banks have been trimming back their brick-and-mortar branches as more transaction activity moves online, Bank of America has cut more than its peers. SNL Financial earlier found that the bank had cut more branches in the last four years than any other bank.

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BB&T says it could have been growing even faster

BB&T claimed success Wednesday on its branch and wealth management expansion into Texas and said capital levels are strong. But CEO Kelly King told investors in New York that the Winston-Salem bank could have been growing its loans even faster.

The bank didn't, however, because most of the market was for leverage lending, he said. That entails lending to companies that already have a high amount of debt. "It's too rich for our appetite," he said. King says BB&T will not ease underwriting, though it will be more price competitive.

N.C. PENSION RANKED THIRD-STRONGEST: The state treasurer's office says the North Carolina public retirement systems is the third-strongest in the nation at 93.9 percent funded, according to Morningstar. The national median is 68.4 percent.

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Wells Fargo's institutional retirement head wants more focus on 401(k)s

In Joe Ready's ideal world, during the benefits enrollment ritual that many businesses go through every year employees would get asked to do more than sign up for health care, dental and vision plans.

They would also get prompted to opt in to their companies' 401(k) plans or increase their contributions.

Now Ready, the Charlotte-based director of Wells Fargo's institutional retirement and trust unit, is hoping to get companies to buy into that vision.

Steps taken so far, he said, include Wells Fargo discussing the concept with the companies for which it services retirement plans. He said the response so far has been positive.

In addition, Wells Fargo is examining possible partnerships with software vendors that provide the human resources portals used for benefits enrollment, Ready said. He stressed that Wells Fargo is in the early stages of coming up with concepts for such partnerships.

Ready said the goal of such efforts is to make the idea of retirement saving more front and center for employees than it currently is.

"If you think about benefits in general … dental, vision, health care … there’s a whole process that’s very well-defined around that," he said. "For some reason in this country, and within the corporate benefits space, we have moved retirement out to the side.

"We're trying to drive the importance of it. If you think about it, it’s the second biggest decision you will probably make that will impact your long-term financial well-being, in addition to health care."

Ready talked about the issue with the Observer Wednesday, when Wells Fargo and Gallup released results of a survey on retirement saving. The survey found that optimism among people investing in retirement plans fell eight points from August to November as investors lost confidence in the economic recovery. Although the investor and retirement optimism index remained in positive territory, it dropped to a reading of 25, its lowest level this year.

The poll also showed that investors who are making regular contributions to 401(k)s or 401(b)s, or taking regular disbursements from them, are more optimistic than those who don't have such plans.

Among other noteworthy survey findings, 45 percent say now is not a good time to invest in the stock market, even though stocks have been surging this year.

This month, Ready became the sole director of the unit after Laurie Nordquis, who is based in Minneapolis and was also director of the unit, was promoted to head Wells Fargo's personal and small business insurance operation.

Ready has been with Wells Fargo and its predecessor companies, including First Union and then Wachovia, for 28 years. Among other things, his unit services roughly 5,000 retirement plans for about 3.6 million 401(k) participants and pensioners of various companies.

Ready talked with the Observer about the poll results, the lender's push to get employees to think more about saving for retirement and other topics. Questions and answers have been edited for brevity and clarity.

Tell me more about these efforts to get companies and employees thinking more about retirement saving. 

Those are things that we're working on internally right now. Our goal would be maybe to partner with, and we're sort of working through this from a concept standpoint, some of those firms on those HR portals.

Right now we're sort of in the formulation stage of these ideas. One of the dialogues we’ve had, and this is really resonating with companies, is … how do we move retirement into that enrollment process with the same visibility as these other benefits and at least make sure that people understand it is important, it is primary and it needs to be considered in the context with all those other benefits on an equal basis. The reality of it is …  the defined-contribution system is going to be the primary benefit for you. We need to bring it into that decision-making process.

As you see it, saving for retirement hasn't received the same emphasis as enrolling in health care and other benefits. Why do you think that is?

If I ask people "Why have we moved it to the side?" the best answer I've gotten is that's the way we've always done it.

What prevent companies from making it part of the annual benefits-enrollment process?

The broad objection right now is primarily around the technology change and development they have to put in place to do this. I think this will gain momentum, because the response we've gotten around it as an idea has been really positive.

Regarding the survey results, what was your reaction to the drop in the index from August to November?

I was actually surprised. I thought it would have dropped more, given some of the budget stalemates, the debates, the government shutdown and some of the broader, macro economic issues.

What were some of those macro issues? 

Health care costs was a big concern, unemployment, underemployment (and) wage stagnation were sort of the leading, top three macro economic issues.

Bankers these days say businesses are reluctant to borrow because of uncertainty about the economy and government policy. Are those things impacting how much people contribute to 401(k)s?

Within our broad book of business, I would say the average savings rate remains flat. So, it’s not increasing, which we think is really important; if people really want to hit their goal, the only way they’re going to get there is to save. The average deferral rate has stayed pretty constant … over the last three years.

What about the number of people participating in 401(k) programs?

That’s not growing.

Stock prices have been climbing, so why are people reluctant to invest in the market? 

People are still feeling the effects of the drop, the financial drop, that they had in 2009. I think people are still skeptical. You might think that, broadly, those that were near retirement during that era, that saw a significant drop in their balance, might be the ones that would have the longest memory. When we look at the age demographics, we would say it doesn’t really stand out that way.

People just are not convinced on the recovery or they’re just skeptical because they’ve seen this drop four years ago and are really hesitant to go back into the market. That’s something that we have to work to correct.

With the stock market hitting record highs this year, are people making big changes to where their money is allocated in retirement plans? 

We have not seen a big change in allocation. Inertia's a tough thing within these plans to overcome. People just fail to act.

What's your financial resolution for 2014?

I don't think it changes from year to year. I max out on whatever I can from a retirement standpoint. I'll just continue to do that. Three years ago, I got the magic touch of catch-up contributions; that's an eye-opener for you when you hit that age. Then I sort of continually focus on, at the same time, trying to just pay down debt.

The one habit I am in is I do take the opportunity to kind of step back and look at everything and include my wife in that process.

The only other resolution is I want to spend time in Charleston, at the beach.

Wednesday, December 11, 2013

Former Carolina Panther's private equity firm still in the market

It's been a relatively quiet last two years for Axum Capital Partners, the private equity firm co-founded by former Carolina Panther Muhsin Muhammad. But the company is still actively in the market looking for deals, the man who spent 14 years at wide receiver.

We caught up with the popular Pro Bowler on Wednesday as his firm's first and, at the moment, only portfolio company prepares to sponsor a high-profile high school basketball tournament in Charlotte later this month. He said he hopes the Wild Wing Cafe name on that event will help propel the restaurant chain to iconic status in the area. You can read more about the tournament and Wild Wing Cafe's growth strategy here.

But we also had a chance to catch up about Axum Capital Partners and talk about what's been going on with the firm since acquiring Wild Wing Cafe nearly two years ago.

Axum Capital once had ambitions of raising a large fund to make acquisitions. Directors had originally targeted $150 million to acquire lower-middle-market companies in the food and beverage and education sectors. But as the opportunity arose to acquire Wild Wing Cafe, Muhammad said Axum turned its attention toward closing the deal instead of raising more money.

The company's fund closed in September with about $15 million raised, according to a securities filing. Muhammad said Axum is still looking at a number of different investments, in companies in those original sectors.

Axum has also brought on board a number of high net worth individuals (read: wealthy people) and athletes as limited partners in the fund, Muhammad said.

He's also kept up with his former team this year, in what is proving to be a special season with echoes of Muhammad's penultimate year with the Panthers.

"They’re headed in a positive direction," the man often known on the field as Moose said of this year's squad. He called this past weekend's loss to New Orleans a setback, but a common one for successful teams over the course of a season. "The panthers have to bounce back like a team on destiny."
You might remember the 2008 Panthers team, the last to make the playoffs. The team finished 12-4, with Muhammad catching 65 passes for 923 yards and five touchdowns.

The current team's defense is better, but the '08 team ran the ball more effectively and had a more vertical passing game, he said.

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Tuesday, December 10, 2013

It's 'Pony Week' at Wells Fargo (and other news)

That's right, it's "Pony Week" again at Wells Fargo. The San Francisco bank has a tradition of turning one of its legendary stagecoach pullers into a plush toy every year. Wells wants to hear from you on social media on whether El Toro, Mike or Strawberry should make the cut in 2014. You can learn more about these noble steeds on the bank's YouTube page.

ONE IN THREE PEOPLE SAY BANK NEVER FIXED THEIR PROBLEM: So says Charlotte-based consulting firm Carlisle & Gallagher Consulting Group in a new report released Monday. The worst offending product? The simple checking account.

MERRILL SAYS GENDER DOESN'T REALLY MATTER IN INVESTING: Sure, there are some differences between how men and women invest their money, but the gap is a lot narrower than most people have thought, Merrill Lynch says in a new report. Other social and demographic differences matter more.

CAROLINAS CREDIT UNION LEAGUES UNVEILING BRANDING: As they get set for their Jan. 1 merger, the industry groups representing credit unions in North and South Carolina have begun unveiling their new branding.

WELLS FARGO CHAMPIONSHIP TICKETS ON SALE: Grounds passes for the signature golf tournament that's been held in Charlotte since the Wachovia days are now up for grabs at SouthPark Mall. This could be the last event of its kind in the city for a while. Wells Fargo's contract expires after 2014, and as far as I know a deal has not been reached to extend the tournament's run at Hollow Club. It definitely won't be here in 2017 since the PGA Championship will be in town.

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Wells Fargo CEO optimistic about 2014

Wells Fargo CEO John Stumpf said Tuesday that he expects the U.S. economy to continue to improve in 2014, but it won't be a "breakout year."

Stumpf, speaking at an investor conference in New York, said businesses and consumers remain cautious in what he called a "challenging economic environment." He, like other bankers, say that such caution is resulting in tepid demand for loans.

With the new year just three weeks away, Stumpf said he's encouraged by U.S. job growth, continued strengthening of the housing sector and government progress toward reaching a budget deal.

"The economy's healing," he said, according to a Bloomberg transcript.

"I don't think 2014 is going to be a breakout year, but I do think it will show the continued improvement we saw in 2013," he said. "And as I'm talking with customers, especially our small-business and middle-market customers, I'm starting to hear a little more about expanding the business, building a new building, another product line and so forth. So, as we look to the year, I'm optimistic."

Stumpf said the bank is watching its expenses closely. This year, the bank laid off thousands of employees in its mortgage unit amid lower demand from consumers to refinance home loans. Other banks have also announced similar layoffs this year. Fewer consumers are refinancing as mortgage rate rise.

"I still think we have room to go on expenses," Stumpf said. "We think we're pretty good in the expense side, but we can get even better."

Stumpf delivered his comments a day after the Charlotte Chamber of Commerce's annual Economic Outlook Conference, at which executives from some of Charlotte’s biggest corporations said Charlotte and the nation can expect slow economic growth next year as the nation’s businesses struggle with weak consumer spending and uncertainty about state and federal policies.

Monday, December 9, 2013

The Charlotte Chamber economic forecast forum in tweets

You can check out my colleague Eric Frazier's excellent coverage of the Charlotte Chamber's annual economic forum here. But if you want some quick hit highlights, with an emphasis on the big-name bankers in attendance, take a look at some of my tweets from the event below.

Headlining the event were Bank of America CEO Brian Moynihan and Wells Fargo wealth, brokerage and retirement head David Carroll. Federal Reserve president Jeffrey Lacker started things off with his economic prognostication.

Saturday, December 7, 2013

Biometrics: The next thing in bank authenticating?

Would you allow your bank to scan your fingerprint – or perhaps iris or retina – so you could access your account?

Like it or not, banks are exploring that very thing.

I spoke this week to two industry insiders who said banks are looking at how biometrics might be used with smartphones or automated teller machines. Under consideration, they say, is using biometrics for authenticating, meaning verifying that a person is who they say they are.

Ed O’Brien, a banking analyst for Maynard, Mass.-based Mercator Advisory Group, told me there’s “a lot of interest” in biometrics among banks. No systems are in production yet, as far as he knows, he said. He said biometrics would provide a quick, accurate and secure method of authenticating.

Automated teller machines could be one application for fingerprint scanning, which could become one step in the authenticating process, O’Brien said. On top of fingerprint scanning, banks might add another layer of authenticating, such as requiring the customer to enter a passcode, he said.

Kristen Rankin, who oversees mobile banking for Atlanta-based SunTrust Banks, said it’s likely that fingerprint scanning will be used by the banking industry to allow customers to sign on to mobile banking.

But O’Brien and Rankin see obstacles that are keeping the technology from being quickly rolled out.

Rankin said Apple's fingerprint sensor technology on the iPhone 5S is proprietary, preventing banks and other companies from using it now for their mobile applications. (That issue aside, Apple customers have complained that the reader doesn’t always work properly.)

O’Brien said banks will likely wait until other industries make wider use of biometrics before they introduce it to their customers. That's because banks will want to be sure customers are comfortable with biometrics, he said.

He said it remains unclear how to safeguard the technology so that fingerprint files can’t be stolen.

“I think there are a lot of questions to be sorted out and answered before the average consumer would be comfortable using it,” he said. “I think we’re still two or three years away, in general, not necessarily for banking.

“Once biometrics become more widespread … the next step might be, ‘OK, why can’t I use this for mobile banking?’”

For now, banks are quietly studying the technology, he said.

There’s “a lot of work going on in the background.”

Bank of America accused of discriminating against minority borrowers

The city of Los Angeles has added Bank of America to the list of banks it is suing over alleged discrimination mortgage lending practices against minorities, according to news reports.

The Charlotte-based bank was sued Friday in federal court. On Thursday, the city filed similar federal lawsuits against San Francisco-based Wells Fargo and New York-based Citigroup.

Since at least 2004, the three banks have practiced discriminatory lending to minority borrowers, placing them in loans they could not afford, which resulted in large numbers of foreclosures in minority areas, Los Angeles said in the complaints, according to Bloomberg.

According to Bloomberg, a spokesman for Bank of America said the bank’s record shows there’s no basis for the city’s claims. A Citi spokeswoman said the bank reviews its mortgage applicants based on the same objective criteria. A Wells Fargo spokesman called the accusations baseless.

Friday, December 6, 2013

Merrill Lynch wins final approval to settle racial bias case

A federal judge on Friday gave final approval to a $160 million settlement in a racial bias suit against Bank of America's Merrill Lynch unit, Bloomberg reported.

The lawsuit accused the brokerage giant of denying black brokers the same opportunities as their white counterparts. The allegations stemmed from before Bank of America acquired Merrill in 2009.

The settlement brings to a close the lawsuit brought by Nashville, Tenn., broker George McReynolds in 2005. Over its lifespan, the case grew to a class of at least 1,000.

Charlotte-based Bank of America denied discriminating against black brokers. The case was set to go to trial next month.

According to Bloomberg data, the settlement is the third largest in U.S. race-bias litigation.

In September, in a different case, the U.S. Department of Labor ordered Bank of America to pay $2.2 million to more than 1,000 black job applicants turned down for positions in Charlotte after a federal judge ruled that the bank racially discriminated against them.

In that case, the bank had been accused of rejecting qualified black candidates for teller jobs and entry-level clerical and administrative positions in 1993 and again between 2002 and 2005. An administrative law judge ruled the bank used “unfair and inconsistent selection criteria” in choosing white applicants over black job-seekers.

Bank of America has said it is reviewing the Labor Department's order.

Earlier in September, the bank agreed to pay $39 million to women who worked at Bank of America and Merrill Lynch brokerages who claimed they were not given an equal chance to succeed.

PNC to pay Freddie Mac $89M

PNC Financial Services Group said Friday it has reached an $89 million settlement with Freddie Mac over mortgages sold to the government-backed housing agency leading up to the financial crisis.

Pittsburgh-based PNC, the 11th-largest bank by market share in the Charlotte area, said the deal covers loans sold from 2000 and 2008. It resolves PNC's existing and future obligations to repurchase roughly 900,000 loans.

Since the crisis, Freddie Mac and its sister agency, Fannie Mae, have asked many banks to buy back mortgages that went sour. Friday's settlement resolves "substantially all" of PNC's outstanding and potential repurchase obligations stemming from loans sold to Freddie Mac and Fannie Mae from 2000 to 2008, the bank said.

PNC reached an earlier agreement with Fannie Mae to resolve repurchase demands.

Earlier this week, Bank of America announced a $404 million settlement with Freddie Mac over mortgage-repurchase claims.

PNC shares were up 1.4 percent at $76.10 in early afternoon trading Friday.

Thursday, December 5, 2013

Chanticleer Holdings signs agreement to buy Texas restaurant

Charlotte-based Chanticleer Holdings said Thursday it has signed an agreement to buy a Texas seafood restaurant that would join a fast growing list of companies Chanticleer has acquired this year.

Chanticleer said it expects the deal to buy Spoon Bar & Kitchen, in Dallas, to close by Dec. 31. The deal needs approval from Chanticleer's board and still has to be reviewed by Nasdaq and Securities and Exchange Commission officials, Chanticleer said in a regulatory filing.

The deal calls for Chanticleer to purchase Spoon Bar & Kitchen's outstanding shares by issuing 195,000 Chanticleer shares to Dallas Spoon and Dallas Spoon Beverage, the companies that own and operate the restaurant. The deal also gives Dallas Spoon the right to buy 97,500 additional Chanticleer shares at $5.50 and 97,500 at $7.

It's unclear how much the deal will be worth, since it will depend on the value of Chanticleer's share price at the time the deal closes. Using Monday's closing price of $5.18 puts the deal at $2.2 million.

Chanticleer described Spoon Bar & Kitchen as a fine dining restaurant. Its chef is John Tesar.

Chanticleer CEO Mike Pruitt said in a statement that the deal creates an opportunity for Chanticleer and Tesar "to expand the Spoon brand into a new, fast-casual dining concept.”

The deal marks yet another new venture for Chanticleer, which until this year had been focused solely on owning and operating Hooters restaurants outside the U.S. Its Hooters are in Australia, Hungary, South Africa and the U.K. Chanticleer said Wednesday it has signed an agreement that expands the number of Hooters it and a partner can open in Brazil.

This year, Chanticleer bought Charlotte-based American Roadside Burgers. Last month, it said it has acquired a majority stake in the companies that own the Charlotte-based Just Fresh restaurant chain.

Earlier this week, Chanticleer said it has become an investor in Beacher’s Madhouse, a nightclub operator with a location in Los Angeles and one set to open in Las Vegas.

Last month, Chanticleer said it had raised $800,000 in a private offering of shares.

Chanticleer shares rose 4.2 percent Thursday.

Bank of America settlement mocked on 'The Daily Show'

“It’s that old saying, ‘Don’t do the crime if you can’t pay the nominal fine,’” Jon Stewart of “The Daily Show” said Wednesday, in a segment that took aim at Bank of America’s $404 million settlement with Freddie Mac.

The roughly seven-minute segment criticized other bank settlements, including JPMorgan Chase & Co.’s $13 billion deal with the U.S. Justice Department. That settlement, announced last month, resolves claims over toxic mortgage-backed securities.

Bank of America's Freddie Mac settlement was announced Monday. The deal means it has resolved all outstanding mortgage-repurchase claims with government-controlled Freddie and its sister institution, Fannie Mae.

Stewart, the show’s host, offered this comment near the start of the segment: “One way to distinguish corporations from people would be to show that they don’t suffer the same consequences for their actions that we mere mortals may,” he said.

“For instance, let’s say you or I knowingly sold, say, 700,000 bad mortgages. What would happen to us? Probably not this,” he said before news clips on Bank of America’s $404 million settlement aired.

“I’m sorry I committed systemic fraud for 10 years,” Stewart said, apparently taking the perspective of Bank of America. “How 'bout I give you a cut of it?”

In corporate America, there is a “simple credo that exists to cover up any wrongdoing,” Stewart said just before a clip from the TV show “Mad Men” was played.

“That’s what the money is for!” Don Draper, from the show, said in the clip.

“That’s what the money is for!” Stewart echoed.

Later, a news clip that explained JPMorgan did not admit wrongdoing in reaching the $13 billion settlement prompted this from Stewart:

“Oh, so if you didn’t do anything wrong, per se, is the $13 billion a gift? A downpayment? A tip?”

Wednesday, December 4, 2013

Bank of America agrees to $20M settlement in municipal derivatives case

Bank of America has agreed to a pay $20 million to settle a 5-year-old lawsuit that accuses it of rigging bids for municipal securities.

The proposed settlement was filed Wednesday in federal court in New York. It needs court approval.

The lawsuit, filed in 2008 against major banks, claims they participated in a conspiracy to fix prices of municipal derivatives. States, cities and counties invest bond proceeds in the derivatives until they are ripe.

The settlement comes on the heels of other settlements reached in the case, including with Morgan Stanley, JPMorgan Chase & Co. and Wells Fargo.

If approved, the settlement would resolve all claims against Bank of America.

State attorneys general have reached their own settlements with banks, including Bank of America, over municipal derivatives. Those settlements, coupled with Wednesday's, bring Bank of America's total settlement costs to approximately $82.5 million, according to court documents.

Chanticleer Holdings announces expanded franchise agreement in Brazil

Charlotte-based Hooters franchisee Chanticleer Holdings said Wednesday it has signed an agreement that expands the number of Hooters it and a partner can open in Brazil.

Chanticleer, an investment company, said the new franchise agreement involving partner Wings Brasil Restaurante allows it to open Hooters in five states, up from three. Also, the number of Hooters to be opened has grown from five to seven.

Chanticleer and Wings Brasil Restaurante are partners in Chanticleer & Wings Brasil Foods Participacoes, of which Chanticleer holds a 60 ownership interest. Wings Brasil Restaurante manages three Hooters in São Paulo. The agreement announced Wednesday is between the partners and Hooters of America, the privately held parent company of the Hooters brand.

The first of the seven planned Hooters is set to open in April in Rio de Janeiro.

Chanticleer owns and operates Hooters in other countries, but none are in the U.S. Its other Hooters are in Australia, Hungary, South Africa and the U.K.

While Chanticleer continues to grow Hooters restaurants internationally, that has no longer been its sole focus since its purchase this year of Charlotte-based American Roadside Burgers and a majority stake in the companies that own the Charlotte-based Just Fresh restaurant chain.

Earlier this week, Chanticleer said it has become an investor in Beacher’s Madhouse, a nightclub operator with a location in Los Angeles and one set to open in Las Vegas.

Wells Fargo names replacement for Charlotte exec who died in August

Wells Fargo said Wednesday that it has named a replacement for a Charlotte-based executive who died in August at age 56.

The bank said Laurie Nordquis, based in Minneapolis, has been promoted to head its personal and small business insurance unit. Nordquist, who was most recently executive vice president and director for Wells Fargo Institutional Retirement and Trust, starts in her new role Dec. 16.

Nordquist replaces Anne Doss, who died unexpectedly Aug. 14 at a hotel in Bloomington, south of Minneapolis. Doss' death was from natural causes, according to a medical examiner’s office finding.

San Francisco-based Wells Fargo named Doss to the insurance division position in December 2012. Prior to that, she led Wells Fargo’s insurance national practices and special risk group.

Although the head of the personal and small business insurance unit will no longer be based in Charlotte, it will not result in staffing changes in Charlotte, Wells spokeswoman Angenette Lau said.

"Wells Fargo Insurance is committed to the Charlotte market," she said.

Nordquist joined Wells Fargo in 1990. She will lead a team focused on providing auto, home, renters, life and health and umbrella insurance products to consumers and property, liability and other insurance to small businesses.

The bank said Joe Ready, executive vice president and director of Wells Fargo Institutional Retirement and Trust, will now become the sole director of the bank’s institutional retirement business.

Tuesday, December 3, 2013

Chanticleer Holdings invests $500,000 in Vegas nightclub

Dancing Oompa Loompas. The "World’s Tallest Female Stripper."

Charlotte-based Chanticleer Holdings has just become an investor in a nightclub company known for such acts.

This week, Chanticleer said it has made a $500,000 investment in Beacher’s Madhouse's Las Vegas location, set to open on New Year’s Eve in the MGM Grand Hotel & Casino. The deal gives Chanticleer the rights to purchase up to a 25 percent stake in any additional Beacher’s Madhouse locations that might open.

The only other permanent Beacher’s location is in Los Angeles. That venue's other oddities include the "World’s Oldest Male Stripper," "Mini Lady Gaga" and "Shaving Cream Guy," who makes sculptures with shaving cream on his body.

While Chanticleer continues to grow Hooters restaurants internationally, that has no longer been its sole focus since its purchase this year of Charlotte-based American Roadside Burgers and a majority stake in the companies that own the Charlotte-based Just Fresh restaurant chain.

“We believe the addition of the Beacher’s Madhouse investment into our current restaurant and entertainment portfolio makes perfect sense,” Mike Pruitt, Chanticleer CEO, said in a statement.

The deal also gives Chanticleer the exclusive rights to purchase up to 25 ownership interest in Beacher’s clubs that might open in South Africa, Australia and the U.K. Chanticleer already owns and operates Hooters in those countries.

Monday, December 2, 2013

'Twelve Days of Christmas' to set you back a great deal more

The "Twelve Days of Christmas" would set you back a great deal more this year -- and the nine ladies dancing are to blame.

So says the annual tongue-in-cheek economic report from PNC Bank, which takes a look at how much it would cost each year to actually buy all of the things in the iconic Christmas carol. The so-called "Christmas Price Index" increased 7.7 percent this year, much higher than the meager rate of inflation. If the "true love" in the song gave each of the rounds of presents only once, they would cost $27,393.17 this year, more than a thousand dollars more than 2012.

The "nine ladies dancing" in the song increased the most, jumping 20 percent in the past year. PNC's economists says the major jump was in effect to offset small raises in pay in previous years. Your 10 Lords-a-Leaping had the second highest wage increase, at 10 percent.

Don't worry. Your partridge, two turtle doves, three French hens, five golden rings, six geese-a-laying, seven swans-a-swimming and eight maids-a-milking won't cost you any more this year. And your pear tree actually fell in price.

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Wednesday, November 27, 2013

Carolina Premier Bank to change name, convert charter

Charlotte-based Carolina Premier Bank said Wednesday that it intends to convert from to a national charter, and change its name to reflect a broader focus.

The bank had been operating under a North Carolina charter. But as it looks to grow in Washington D.C. and expand its product line, Carolina Premier said the switch made more sense.

CEO John Kreighbaum said the new name has been picked out, but declined to say what it is ahead of an official announcement. It will still take at least a few weeks for regulators to approve all the changes.

Carolina Premier, which is a subsidiary of Premara Financial, said in June that it had opened a retail branch in the nation's capital under the name Premara Bank. Kreighbaum said the bank is now trying to build on that, focusing on trade associations, nonprofits, advocacy groups and law firms.

Ultimately, the bank's goal is to fill the corridor between the two cities. Kreighbaum said Carolina Premier took a look at buying branches or entire banks in Virginia, but decided to take a pass.

He said the national charter will also help it expand its offerings in insurance, wealth management and mortgage.

The charter change won't affect Charlotte customers. Carolina Premier mostly serves small businesses and individuals in the city.

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Tuesday, November 26, 2013

Moynihan re-elected to board of trade group

Bank of America CEO Brian Moynihan has been re-elected to the supervisory board of The Clearing House, the trade group owned by the world's largest commercial banks said Tuesday.

Moynihan serves as vice chairman of the board.

Also Tuesday, The Clearing House said Richard Davis, CEO of U.S. Bancorp, has also been re-elected as chairman of the board.

Their terms are for one year.

Bruce Thompson, chief financial officer for Bank of America, will remain as vice chairman of the group's CFO Summit.

N.C. sheds banks at fastest pace in two decades

North Carolina has lost more banks to consolidation or failure in the past year than it has in almost two decades, federal data released Tuesday shows.

The state had 79 banks as of the end of the third quarter, according to a report from the Federal Deposit Insurance Corp. That's down from 92 at the same time period last year -- a decline of 13 banks.

That's the most precipitous drop since 1995, when North Carolina lost 14 banks from the year before to decline to 128.

A good part of the decline in the past year can be attributed to the long-expected wave of bank mergers finally coming to fruition. Since last September, Charlotte-based Park Sterling Bank bought Citizens South, Bank of North Carolina bought Charlotte-based First Trust, Bank of the Ozarks bought First National Bank of Shelby, NewBridge Bancorp bought CapStone Bank, among several other deals.

Meanwhile, a few banks have failed. Asheville's Pisgah Community Bank failed in May, and Lenoir-based Parkway Bank closed in April.

The number of bankers in the state has fallen as well. The FDIC reported 206,554 employees of the state's banks this year, down nearly 8 percent from the year before.

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Monday, November 25, 2013

Paragon Bank to move into new space in 1Q

Paragon Bank is planning to move into its new Charlotte office in the middle of the first quarter, the bank’s Charlotte market president said.

And, Phil Jurney said, the bank will be adding employees to its new, larger space.

Raleigh-based Paragon is moving from Piedmont Town Center, where its customers have to take an elevator to get to the bank’s offices, to a standalone building less than a mile away. The move will keep the bank in SouthPark.

Renovations continue on the new space, a building at 6337 Morrison Blvd. that once housed UBS Financial Services. Paragon bought the property in December for $4.2 million.

Paragon’s new home will be 16,427 square feet. Its Piedmont Town Center space is 9,562 square feet.

Jurney said Paragon will have room for growth in the renovated two-story building. The bank has about 17 employees at Piedmont Town Center, he said. Those employees will fill the first floor and less than one-third of the second at its new space, he said.

Paragon is looking to add commercial and industrial lenders and private bankers to the second floor, he said. The bank might also add a credit analyst, he said.

Jurney also said the vault in the new space is bigger than the one at Piedmont Town Center. The bank needs the larger vault to accommodate growth in safety deposit boxes, he said.

Paragon caters to middle-market companies with revenues from $2 million to $75 million, their executives and high-net worth individuals. The bank only has two locations. The other is in Raleigh.

Jurney said one advantage to the new space is customers can park next to the building on a surface lot. At Piedmont Town Center, customers had to use a parking deck, he said.

The other upshot: “A building we can put our name on.”

(Photo by Deon Roberts)

Friday, November 22, 2013

Bank of North Carolina nabs SVP from Park Sterling

Bank of North Carolina announced Friday that they've brought on Tracey Hill as senior vice president and treasury management sales manager. He'll be in charge of the business service sales team, putting new products into place and drumming up new business.

Hill most recently worked as a senior vice president at Park Sterling Bank. Both Bank of North Carolina and Park Sterling jumped up the Charlotte-area market share chart this year through acquisitions of local banks.

Hill's also worked in treasury management at Bank of America and BB&T.

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Thursday, November 21, 2013

Bank of America investors appeal dismissal of lawsuit brought by shareholders

Three investors are appealing a federal judge's dismissal of a case in which shareholders had accused Bank of America of failing to disclose the potential for a lawsuit eventually brought by mortgage-securities investor American International Group.

Camcorp Interests, Alaska Electrical Pension Fund and Northern Ireland Local Government Officers’ Superannuation Committee filed a notice of appeal Wednesday in U.S. district court for the Southern District of New York.

Shareholders sued Bank of America in September 2011, just a month after AIG sued the bank over $10 billion in losses it said it suffered on $28 billion invested in mortgage-backed securities.

In their lawsuit, the shareholders said Bank of America knew by at least January 2011 that AIG intended to file a "massive" lawsuit against the bank. But the bank's 2010 annual report submitted to regulators in February 2011 failed to mention the possible AIG lawsuit, the shareholders claimed.

On the day the lawsuit was filed, Bank of America shares fell 20 percent, resulting in losses to shareholders, the shareholders said in their suit. It was also the first trading day since Standard & Poor's downgraded U.S. debt, causing the Dow Jones industrials to fall 634.76 points. 

Their appeal follows a Nov. 1 decision by U.S. District Judge John Koeltl in New York.

Koeltl said the bank had disclosed the heightened litigation risks it faced because of its acquisitions of Countrywide Financial Corp. and Merrill Lynch. Koeltl also wrote that Bank of America was not obligated to disclose the imminence of the AIG lawsuit, because the bank could not be certain about that.

Charlotte commercial mortgage broker acquires Raleigh peer

Charlotte-based commercial mortgage broker Capital Advisors Inc. said this week that it has acquired a similar company based in Raleigh in a deal that will give the firm more partnerships and industry veterans.

Dickinson, Logan, Todd and Barber Inc. has agreed to merge into the company, which will continue to be headquartered in Charlotte and run by Capital Advisors CEO C. Cooper Willis. The two companies had been talking about a merger for several years. Terms of the deal were not disclosed.

Capital Advisors has originated more than $13 billion in commercial loans since it was founded in 1994. Once the deal is done, the combined company will service more than $1.5 billion in loans on behalf of insurance groups that invest in real estate, like MetLife and Prudential.

Besides Charlotte, the company has loan production offices in Raleigh, Greensboro, Columbia, S.C., Greenville, S.C., Atlanta, Birmingham, and Jacksonville, Fla.

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First Bancorp to open Charlotte loan production office

Southern Pines-based First Bancorp says it plans to open a loan production office in Charlotte by the end of the year.

I've seen a First Bank sign on a building on Kennilworth Avenue just before it turns in Stonewall Street, but the bank has not confirmed whether that's the location for this office. The nearest First Bank branches are in Mooresville, Kannapolis or Polkton.

The bank made $6.1 million in the third quarter, up 65 percent from the same time period a year ago.

UPDATE NOV. 25: Yes, that office at 1301 Harding Place is, in fact, where the loan production office is opening up. Chief Retail Banking Officer Dorson White says they're targeting a Dec. 2 launch. The office will primarily originate commercial loans, but the bank is considering putting a mortgage originator there as well.

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Bank of America issues $500 million 'green bond'

Bank of America said Thursday that it has issued a $500 million bond the bank will use to finance green energy projects.

The bond offering is likely the first of its kind. And it has gathered interest from big name Wall Street investors and is the latest in the Charlotte bank's public commitments to green energy.

The three-year bond pays 1.35 percent interest per year. Bank of America will take the money it raised in the offering and use it to finance renewable energy and energy efficiency projects, like geothermal power and building insulation.

Bank of America will pay the principal and interest out of its general fund, according to the prospectus, instead of dedicating money the bank makes from its green investments toward paying investors.

Several big name institutional investors -- including BlackRock, California State Teachers’ Retirement System, State Street Global Advisors and TIAA-CREF -- participated in the bond offering, Bank of America said.

Bank of America has been a target for environmental activists in recent years, particularly at its annual meetings, because of the bank's funding of coal project. But the bank has also been active in its funding of renewable energy projects. Last year, Bank of America committed to investing $50 billion in green projects over a decade, after finishing an earlier, similar pledge ahead of schedule.

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Bank of North Carolina hires sales strategy officer

High Point-based Bank of North Carolina said Wednesday that it's brought on Rick Arthur as its chief sales strategy officer.

Arthur has spent his career in Charlotte and Charleston, first at Bank of America overseeing sales and community markets, then as an executive leader at First Federal Bank.

He'll now be a direct report of Bank of North Carolina CEO Rick Callicut and oversee all branches and products, and work on referrals between different lines of business.

BOFA, WELLS BELOW AVERAGE ON CORPORATE RESPONSIBILITY SCORECARD: The Interfaith Center on Corporate Responsibility released a report Wednesday on how big banks performed on shareholder issues like risk management and executive compensation and gave both Bank of America and Wells Fargo below-average marks.

Bank of America showed strong risk management disclosures but low transparency in political giving and executive compensation. Wells got high marks for avoiding much of the legal investigations that have swamped its peers, but was dinged for what ICCR called a lack of disclosure on regulatory compliance (like how it's doing with Dodd-Frank rules) and for its payday lending-type services.

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