LITTLE ROCK — Chambers Bancshares of Danville has acquired controlling interest in Peterson Holding Co. of Decatur, which owns Decatur State Bank, Chambers’ chief executive officer said Friday.
Decatur State Bank has been one of the most unprofitable banks in the state, losing $3.8 million through the first nine months this year, $14.2 million last year and $3 million in 2010.
It has been under a regulatory order from the Federal Deposit Insurance Corp. since November last year. At the time, it was ordered to add $6.1 million to its allowance for loan and lease losses.
Decatur State Bank’s assets have plummeted from about $200 million two years ago to $127 million in September.
“It came at an opportune time,” said Randy Dennis, president of DD&F Consulting Group of Little Rock. “It’s good for banking in the state.”
Chambers Bancshares bought Decatur State Bank because “we thought it would be a good fit for our organization,” Chief Executive Officer John Chambers said in a telephone interview.
The Danville and Decatur markets are very similar, Chambers said. Both banks are involved in poultry and other agricultural lending, and that will continue, Chambers said.
Chambers declined to disclose the terms of the transaction. Chambers Bancshares owns more than 80 percent of Peterson Holding, Chambers said. Peterson Holding also owned Grand Savings Bank of Grove, Okla., which has about$230 million in assets.
Decatur State Bank’s offices in Decatur, Gentry and Siloam Springs will retain the Decatur name, Chambers said. He isn’t anticipating any change in employees, Chambers said.
Chambers Bank of Danville, which has about $700 million in assets and branches in 13 Arkansas cities, including Bentonville, Elkins, Fayetteville and Springdale, also has been under a regulatory sanction since December last year.
The problems for Chambers Bank, which lost almost $18 million in 2010 and about $5.5 million last year, were linked to poor real-estate loans in Northwest Arkansas.
Business, Pages 29 on 12/08/2012