FirstBank Holding Company, the Lakewood-based holding company for the largest locally owned banking organization in Colorado, announced today it has decided to not apply for federal funding as part of the U.S. Treasury’s Capital Purchase Program. FirstBank is well capitalized as measured by all regulatory guidelines and, as a result, does not need the capital injection being made available through the program, according to Dave Baker, FirstBank’s chief operating officer. The company had until this week to apply for funding from the program.
“This decision reflects FirstBank’s strong balance sheet and its continued ability to lend capital to credit-worthy borrowers,” said Baker. “After careful consideration, we determined that FirstBank does not need to participate in the program being offered by the U.S. Treasury.”
A variety of other banks have recently participated in the U.S. Treasury’s voluntary Capital Purchase Program, which seeks to purchase up to $250 billion of senior preferred shares of healthy U.S. banks. The program aims to bring stability to the participating banks’ balance sheets and to increase lending activity to businesses and consumers.
Baker said FirstBank’s balance sheet is already strong and that the company continues to lend capital to businesses and individuals. FirstBank’s total assets were $9.28 billion as of Sept. 30, 2008, up 9 percent compared to the similar time a year ago, and total deposits increased to $7.92 billion, up 5 percent from a year ago. Loans grew by 20 percent to $3.8 billion, while year-to-date earnings were $723.99 per share, up 30 percent from the comparable period a year ago. The company’s net income surged to $95.1 million for the nine months ending September 30, up 29 percent over the comparable period in 2007.
“FirstBank’s focus on making quality loans, along with continued growth in deposits, has contributed to our stability and positioned the company for continued success and growth,” said John A. Ikard, president and CEO of FirstBank Holding Company.
Ikard pointed to a few qualities that distinguish FirstBank from other local, regional or national banks. FirstBank does not originate, hold or purchase any subprime mortgage loans or securities, a fact that has helped the company avoid costly credit losses currently damaging some financial institutions. In addition, some customers are attracted to FirstBank’s relatively unique structure of 25 separately chartered banks, which allows customer deposits to be insured up to $6.25 million by the Federal Deposit Insurance Corporation (FDIC), instead of being insured up to $250,000, as is the case at most banks with a single banking charter.
FirstBank is the largest locally owned banking organization in Colorado, serving more than 600,000 customers. The company is unique in that a majority of its stock is owned by management and employees.