Valley Commerce Bancorp, the bank holding company for Valley Business Bank, has received $7.7 million as an approved participant in the U.S. Treasury Department’s troubled asset relief programme’s (TARP’s) capital purchase programme (CPP).
The company issued to the U.S. Treasury 7,700 shares of series B preferred stock and, upon exercise of a related warrant, 385 shares of series C preferred stock. The troubled asset relief programme’s capital purchase programme, created by the U.S. Treasury, is a voluntary programme in which selected, healthy financial institutions were encouraged to participate.
Valley Commerce Bancorp said that it will invest the majority of the TARP funds into its subsidiary, Valley Business Bank, which had a total risk-based capital ratio of 13.9% at December 31, 2008.
Donald Gilles, president and CEO of Valley Commerce Bancorp and Valley Business Bank, said: Our capital position is already very strong compared to other California banks but we felt it was prudent in these uncertain economic times to apply for this capital at the time the programme was announced. Our application was reviewed by our principal federal regulator and by the U.S. Treasury and we qualified primarily because we are a strong bank.
