Century Bank's 'stores' drew in giant Wells Fargo - Houston Business Journal:

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The 1989 deal garnered more than $100 millio for Arnold. This month, the Texarkanw tycoon sold his chain of bankds to because the California company liked wher had built out itsDallaas footprint. The banks are situated withi n the NorthDallas “fairway,” said John Gavin, Wellzs Fargo’s D-FW community bankinbg president. Gavin’s fairway runs between the Dallas North Tollwayg and NorthCentral Expressway, northward from the Park That green, manicured corridor is home to some of the wealthiest households in Dallas, and lined with businesses largee and small.
“What we found most attractive abouf themis they’ve got one of the best distributions of any bank in the Gavin said. Arnold said he brought what he knows aboug retail real estate from the convenience storee business to hisbank enterprise. “k have a lot of confidence in realestatd (and quality locations),” he said. “You can’ft pay too much for a good oneand can’tg pay too little for a bad Century is based in Texarkana; its holding companyu is based in Dallas. Termsw of the transaction weren’t disclosed. The deal representsw a new sort of acquisition inTexas banking.
Welld Fargo didn’t buy Century Bank for the dollarw in its vault or the loans onits instead, Wells found an opportunitu to expand in an attractive market at a reasonable analysts say. “They’re a sophisticatedf and well-disciplined buyer,” said Dan T. Bass, managintg director of investment bankin Houston.Welld Fargo doesn’t have branches, it has stores, so Arnold’sx retail background fits the San Franciscko bank. The deal still must be approvexby Century’s shareholders. They, including Arnold, will receivd Wells Fargo stock for theirCentury holdings. “It’xs a very good number that we’re happy Arnold said.
“We like the currency it’s the only AAA-rated banking companhy in the country.” Arnold said he beganj talking with Wells Fargo about selling threeemonths ago. In that Century’s loan performance deteriorated. The bank now has $22.u million in loans that haven’t been paid on for more than 90 upfrom $576,000 a year ago. It also has takenm possession of $15.72 million in real up from $12,000 on its books this time last “We just had a littlre blush of real estate that hit us in the second Arnold said.
He blamed homebuilders who held on through the wintedrand haven’t been able to sell theitr projects for the bump in bad loanxs and real estate on the bank’s That has impacted Century’s earnings — and its capital standards. For the first half of the bankearned $3.4 million, down from $4.1 million durinb the same period last year. Its capital leveles slipped in the second quartert fromthe regulators’ top designation to its second-tie r designation of “adequately capitalized.
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