re: First NBC Bank selling 9 branches to Whitney

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First NBC is to ripe of a target to let that happen. They would be attractive for a buyout from another bank before it got that far.

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The majority of their value as a going concern is in their tax credits. Upon a change in control, some pretty sick tax accounting rules kick in that make those credits almost worthless. They don't technically go away, but it just becomes very hard to use them.

So if you strip that away, what you have left is the deposits, the hard assets such as the branches, and the loan portfolio. The loan portfolio for a while was pretty terrible (heavy in FL real estate) but it's gotten somewhat better over time. Still not great.

They are selling 1.3 billion in loan portfolio, plus the 9 branches and the float from those deposits, for basically 850 million - 250 million cash and 600 in federal bank loan assumption. That's a fire sale if I ever saw one.

The cash. and getting that 600 million liability off their books, gives them some time and some breathing room. I don't think in the end, it changes the result.