April 29, 2017 / 1:11 AM / 7 months ago

U.S. regulator shuts First NBC Bank; Whitney Bank to reopen branches

(Reuters) - A top U.S. financial regulator said on Friday that it closed the banking unit of First NBC Bank Holding Co FNBC.O, three days after the lender reported accounting issues dating back to at least 2015.

The New Orleans-based lender has faced series of problems, including regulatory scrutiny on its financial condition, activist investors urging for management changes, a possible sale and accounting issues.

First NBC was closed by the Louisiana Office of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as the receiver. (bit.ly/2oRorAi)

The regulator said Gulfport, Mississippi-based Whitney Bank would assume all of First NBC’s transactional deposits and branches. Whitney Bank will reopen 24 branches of First NBC in Louisiana and five branches as Hancock Bank in Florida.

“No depositor is losing money as a result of this transaction,” the FDIC said in a statement.

Whitney Bank also agreed to buy about $1 billion of First NBC’s assets. The FDIC will retain the remaining assets for later disposition.

First NBC did not immediately respond to requests for comment.

First NBC, in February, had appointed Carl Chaney as CEO. Chaney was formerly with Whitney Bank’s parent Hancock Holding Co (HBHC.O). First NBC sold nine Louisiana branches and about $1.3 billion in loans to Whitney Bank in January.

First NBC Bank had about $4.74 billion in assets and $3.54 billion in deposits, as of Dec. 31.

Shares of the lender, which closed at $2.65, were trading at 20 cents in after-market hours on Friday.

Reporting by Sruthi Shankar in Bengaluru; Editing by Lisa Shumaker

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