PremierWest Bancorp's leadership failed to gain shareholder approval Tuesday of its proposed acquisition by AmericanWest's parent company, Starbuck Bancshares of Spokane, Wash.
During a shareholder meeting at Rogue Valley Country Club, less than half of the company's shares were voted in favor of the merger, forcing executives to adjourn until Wednesday, March 13, and allow more time for proxy votes to come in. (Correction: see below)
Thus far, 46.9 percent of the outstanding shares and 63.9 percent of the total votes cast favored the merger. More than half of PremierWest's shares must be cast in favor of the deal for the Medford-based bank to become part of AmericanWest.
"We're not going to have any comment beyond what we put out," Chief Executive Office Jim Ford said after releasing those details.
PremierWest announced an agreement to be bought by Starbuck Bancshares in October for $16.6 million in cash, about 43 percent of the PremierWest's tangible book value. The bank reported assets of $1.1 billion at the end of 2012 and is well-capitalized, with an 8.95 percent Tier 1 leverage ratio at year end, according to the Federal Deposit Insurance Corp. Tier I capital is a measurement of a bank's ability to sustain losses. It includes core capital such as common stock and retained earnings. However, PremierWest' problem loans represent 4.21 percent of its balance sheet. Further, PremierWest still owes the U.S. Treasury Department $41.4 million for its Troubled Asset Relief Program funds; AmericanWest will pay that off if the deal is approved.
PremierWest said it would again accept proxies via Internet and telephone, beginning 5 a.m. Thursday, until 8:59 p.m. Tuesday, March 12.
In its Tuesday night release announcing adjournment of the shareholder meeting, PremierWest once more urged voters to approve the proposal.
— Greg Stiles
Correction: The date has been corrected in this version.