Public Bank Turnaround/Sale

Mid-Size Bank in Southeastern US

Situation

A regional Savings & Loan Bank was under regulatory supervision and subject to being taken over by the OTS. A new CEO was brought on to save the Bank. This NYSE entity was selling for under $3.00 per share.

LoBue Associates was engaged to re-engineer all operations and participate in the turn-around strategy.

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Recommendations

Redesign mortgage origination processes to improve turnaround times.
Restructure processing areas and centralized customer service capabilities.
Reorganize the appraisal process and establish dispatch capability.
Right-size the staffing requirements of the banking centers.
Provide management analysis techniques to measure productivity.
Restructure and collapse redundant functions throughout the organization.
Introduce peak-time and part-time staffing mixes.
Refocus Branches as sales facilities.

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Results

Due to the successful implementation of all recommendations the Bank staged a dramatic comeback in client service and effectiveness. Business volumes increased and significant cost efficiencies added to a profitability surge resulting in resolution of OTS concerns.

An improving trend in new deposit accounts, mortgage volumes, branch sales of alternative investments and client service improvements, coupled with reduction of supervised loans led to a 600% increase in stock value within 24 months.

Soon thereafter the management accepted a buyout from a major bank, giving shareholders $28.50 per share for their stock, which was trading below $3.00 per share two years prior.

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