San Francisco
415-362-0449
Modesto
209-521-8100

AnchorBank's Holding Company Tries New Bankruptcy Strategy

A bank holding company typically files bankruptcy after the FDIC takes over its bank subsidiary, when the only task left is to marshal assets and liquidate. Anchor BanCorp, holder of AnchorBank, is trying something new.

Specifically, Anchor BanCorp filed a chapter 11 bankruptcy petition on August 12, 2013, before a takeover of AnchorBank, which may be avoided in light of the bankruptcy.  Anchor BanCorp proposes a genuine restructuring in which it would pay off more than $180 million in debt owed to other banks for just $49 million; it could convert the U.S. Treasury’s preferred stock into an equity stake worth about $6 million (the bank received $100 million in TARP funds); and it would recapitalize by canceling its existing shares and sell the remaining new equity to investors.  The bankruptcy court approved the plan last week, but regulators still need to sign off.

If successful, Anchor BanCorp could provide a model for other struggling regional banks to get ahead of the FDIC and take control of their own restructuring.


San Francisco
221 Sansome Street, Third Floor
San Francisco, CA 94104

Phone: 415-362-0449
Fax: 415-394-5544
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Modesto
914 Thirteenth Street
Modesto, CA 95354

Phone: 209-521-8100
Fax: 209-236-0172
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