Company Positioned For Continued Growth, Expansion
PORTLAND, Ore.--(BUSINESS WIRE)--
Holdings Corporation (NASDAQ:UMPQ), parent company of Umpqua
Bank, has redeemed all 214,181 shares of Fixed Rate Cumulative
Perpetual Preferred Stock, Series A, (the "Preferred Stock") originally
issued to the U.S. Department of the Treasury under the Troubled Asset
Relief Program (TARP) Capital Purchase Program (CPP). On Feb. 17, 2010Umpqua Holdings Corporation (the Company) paid a total of $214.2 million
to the Treasury, consisting of $214,181,000 in principal and $59,500 in
accrued and unpaid dividends. The Company's redemption of the shares is
not subject to additional conditions or stipulations from the Treasury.
"Umpqua was asked to participate in the Capital Purchase Program because
of our position as one of the strongest financial institutions in the
country. It was an opportunity to support the communities we serve with
robust lending that helped stimulate our local economies at a crucial
time," said Ray Davis, president and CEO of Umpqua Holdings Corporation.
"We have done just that, originating more than $1.7 billion in loans and
assuming the operations of two failed banks since January 2009. Now, as
the economy improves, we are pleased to have reached an agreement with
bank regulators on this redemption, confirming the capital and liquidity
strength of Umpqua Bank."
Since November 2008, when the CPP investment was made into Umpqua
Holdings Corporation, the U.S. Treasury has earned dividends of $13.5
million from Umpqua Holdings, in addition to a full return of the
original $214.2 million investment.
The preferred stock that the Company will redeem for $214.2 million
currently has a carrying value of $204.5 million (net of a $9.7 million
unaccreted discount) on the Company's statement of financial condition.
The Company will accelerate the accretion of the remaining discount in
the first quarter of 2010, reducing net income available to common
shareholders by $9.7 million.
In connection with the November 2008 issuance of the preferred stock,
the Company issued to the Treasury a warrant to purchase 2,221,795
shares of common stock, no par value per share, at an exercise price of
$14.46 per share. The Company has been notified by the Treasury that as
a result of the Company's completion of its August 2009 Qualified Equity
Offering, the amount of the warrant was reduced by 50 percent to
1,110,898 shares. This warrant is still held by the Treasury and remains
outstanding at this time. The Company intends to negotiate for the
repurchase of the warrant, however, the repurchase price is subject to
these negotiations and there can be no assurance that they will be
repurchased now, or in the future.
About Umpqua Holdings Corporation
Umpqua Holdings Corporation (NASDAQ:UMPQ) is the parent company of Umpqua
Bank, an Oregon-based community bank recognized for its
entrepreneurial approach, innovative use of technology, and distinctive
banking solutions. Umpqua Bank has 162 locations between San Francisco,
Calif. and Seattle, Wash., along the Oregon and Northern California
Coast and in Central Oregon. Umpqua Holdings also owns a retail
brokerage subsidiary, Umpqua
Investments Inc., which has locations in Umpqua Bank stores and in
dedicated offices in Oregon. Umpqua's Private Bank Division serves high
net worth individuals and non-profits providing customized financial
solutions and offerings. Umpqua Holdings Corporation is headquartered in
This press release includes forward-looking statements within the
meaning of the "Safe-Harbor" provisions of the Private Securities
Litigation Reform Act of 1995, which management believes are a benefit
to shareholders. These statements are necessarily subject to risk and
uncertainty and actual results could differ materially due to various
risk factors, including those set forth from time to time in Umpqua
Holdings Corporation's filings with the SEC. You should not place undue
reliance on forward-looking statements and Umpqua Holdings Corporation
undertakes no obligation to update any such statements. In this press
release, Umpqua Holdings Corporation makes forward-looking statements
about capital and liquidity strength of Umpqua Bank and planned
negotiation and repurchase of the warrant issued to the U.S. Treasury.
Specific risks that could cause results to differ from the
forward-looking statements are set forth in Umpqua Holdings
Corporation's filings with the SEC and also include, without limitation,
our ability to negotiate the warrant repurchase.
Source: Umpqua Holdings Corporation