BB&T completed its purchase of BankAtlantic on Tuesday after passing its final regulatory hurdle in a deal that elevates BB&T’s presence in South Florida and closes the final chapter on a 60-year-old homegrown financial institution.
The Federal Reserve Board of Governors and the Federal Deposit Insurance Corp. approved BB&T’s purchase early Tuesday, which gives the bank 78 branches with about $2.1 billion in loans and $3.3 billion in deposits in an area coveted by banks.
Doubling its deposits here, BB&T moves to No. 6 in the South Florida market with a 4 percent share of deposits. The purchase also allows it to move up a rung nationally, rising from the 18th largest bank in the country to the 17th, with 1.4 percent of the nation’s bank deposits, according to the Federal Reserve Board. BB&T is based in Winston Salem, N.C.
BB&T’s president for South Florida, Mike Oster, said the bank has so far given job offers to 650 of BankAtlantic’s 970 employees and more are expected as BB&T completes its transition, replacing BankAtlantic’s name on branches and converting its systems by the end of the year.
As to BankAtlantic’s headquarters building in Fort Lauderdale, which is part of the purchase, BB&T is still analyzing whether it will keep it or put it up for sale, Oster said
BB&T is also in negotiations regarding changing the name of BankAtlantic Center in Sunrise.
“The negotiations and conversations are very positive,” Oster said.
Anticipating the regulatory approvals, documents for the sale of the bank were ready to be signed Tuesday, using emails and faxes, said BankAtlantic Bancorp Chairman and Chief Executive Alan B. Levan.
“This transaction is bittersweet for us, obviously, because we have such a long history of building BankAtlantic, and there are so many wonderful people at BankAtlantic,” Levan said.
The purchase, revised after an initial deal was barred by a judge, also provides for BB&T to assume the holding company’s $285 million of outstanding trust preferred securities.
Debt holders, including New York-based hedge fund Hildene Capital, had filed suit in November, after BankAtlantic announced its original deal. At the end of February, a Delaware judge barred the sale, saying the sale of the majority of BankAtlantic’s assets would trigger a need for immediate debt repayment.
Most other aspects of the first deal remained the same, including the total of $10 million in non-compete agreement payments and severance for Levan, BankAtlantic Bancorp Vice Chairman Jack E. Abdo, and Levan’s son, BankAtlantic Chief Executive Jarett Levan, which were revealed in the judge’s order.
BB&T will get repaid for assuming the $285 million of debt through a new limited liability company, which is owned by BB&T and BBX Capital. Simultaneously with Tuesday’s closing, BankAtlantic Bancorp was renamed BBX Capital.
BBX Capital will put $411 million of loans and real estate into the LLC, which will have a life of seven years, Levan said. BB&T will hold a 95 percent interest in the LLC; BBX, a 5 percent interest
As the $411 million in loans and property is turned into cash, it will be used to pay back the $285 million debt. After that, 100 percent of the remainder will go back to BBX Capital.
BBX Capital will also retain about $175 million of commercial real estate loans and real estate that it plans to turn into cash as the market improves. It also gets the proceeds of a 9 percent premium BB&T is paying for deposits. The company will have a staff of about 40 to 50 people in offices in downtown Fort Lauderdale, Levan said.