Banking Board Minutes - April 20, 2006

Arkansas
State Bank Department

State Banking Board

Meeting Minutes for April 20, 2006

(updated July 18, 2006)

A meeting of the State Banking Board was held in the conference room of the Arkansas State Bank Department, 400 Hardin Road, Suite 100, Little Rock, Arkansas, at 10:00 a.m. on April 20, 2006. The following Board Members were present: Chairman Charles Mazander, Margie Russ, John Freeman and Elmer Flucht [Board Member Marcus McCain was called by phone and participated in the meeting by conference call.] Representing the State Bank Department were Commissioner Bunny Adcock, Deputy Commissioners Luther Guinn and Candace Franks, Financial Analysts Gregg Qualls and Cara Lank, Administrative Assistants II Barbara Mahoney and Devan Adair. Lynn Perkins was the recording reporter for the applicant. Tom Gay was present from the Attorney General’s office. No representatives from the media were present.

Commissoner Adcock opened the meeting. Secretary Luther Guinn declared a quorum was present. Commissioner Adcock then asked the visitors and guest to stand and introduce themselves and state who they represent. Commissioner Adcock announced that the first order of business was election of a new Chairman and Vice Chairman. A motion was made by Marcus McCain, seconded by Margie Russ, to elect Charles Mazander Chairman and David Short Vice Chairman, for the year 2006. The motion passed unanimously and the Commissioner concurred. He then turned the meeting over to Chairman Charles Mazander.

Next on the agenda was consideration of the Minutes of the December 1, 2005 Special Board Meeting. A motion was made by Margie Russ, seconded by John Freeman, to approve the Minutes as presented. Motion carried and the Commissioner concurred.

Next was approval of the expenses for the board. A motion was made by Margie Russ, seconded by John Freeman, to approve the Board’s expenses. Motion carried and the Commissioner concurred.

Next on the agenda was an application by First Financial Bank, El Dorado, Arkansas, to merge Cornerstone Bank, Senatobia, Mississippi, with and into First Financial Bank, El Dorado, Arkansas. Randy Dennis with DD&F consulting Group, Little Rock, Arkansas, represented the application. Mr. Dennis stated that First Financial converted to a state chartered bank a number of years ago. He also stated that First Financial had a lending presence in Mississippi and had been looking for an opportunity to expand in order to serve their customers in Mississippi. He stated that there were very few charters that ever became available in Mississippi. He also stated that Cornerstone Bank was a new charter, was not a stellar performer and had some problems, and that the directors of the bank had several times infused additional capital. He further stated that the bank’s location is part of the Memphis Metropolitan Market.

Steve Cameron of First Financial Bank, El Dorado stated that besides the bank they have a mortgage operation and poultry lending operation operates throughout the southeast part of the United States that is sort of a niche business. He also stated that they have opened loan production offices in various states and wanted to branch in Mississippi. He further stated that they looked for a year and a half to find a bank to buy in Mississippi. Mr. Freeman asked how long the president had been at the bank. Mr. Cameron stated two years and that the current president was not part of the original management of the de novo institution. Mr. McCain asked would there be a need to raise any capital with combined capital of around 7 percent after the merger. Mr. Cameron stated that they may issue some trust preferred later in the year. Chairman Mazander asked about the premium price being paid for the bank. Mr. Cameron stated that they paid some premium because they wanted to get into Mississippi.

A motion was made by Mr. Freeman, seconded by Margie Russ, for a Resolution from the Board to recognize Gus Rusher for his service to the Board [see copy appendage to these Minutes.] Motion carried and the Commissioner concurred.