Lawrence National Bank's president has submitted a bid to buy the institution from the estate of Robert Brozman, the bank's late chairman.
Terry Sutcliffe, LNB president, declined to say how much he had offered to pay for the bank, but the estate's creditors have said they expected to sell the seven banks Brozman controlled for 1.25 times their net worth. Using that formula, LNB, with capital of approximately $6 million, would sell for about $7.5 million.
"I went to Kansas City and submitted my offer and should know sometime next week," Sutcliffe said.
A committee comprising representatives of seven banks that are creditors of the estate has been authorized to sell assets to pay the estate's debts. Brozman's controlling interest in Jayhawk Bancshares, the holding company that owns LNB, is among them. Sutcliffe said the committee would decide whether to accept or reject his bid.
SUTCLIFFE had said previously that the local management of the bank would be interested in acquiring control but declined this morning to say who was participating in the bid he submitted Wednesday.
"I am representing some investors, but the offer is in my name," he said, declining to specify whether the group included current bank officers or directors or any parties outside the bank.
Sutcliffe said he was uncertain whether the estate would seek bids from other parties interested in buying the bank but acknowledged that he had heard rumblings that other offers might be in the works. However, Sutcliffe said he didn't know whether the bank's local management had been given first opportunity to bid.
Thomas Van Dyke, attorney for the estate, could not be reached for comment this morning.
BILL MILLS of M.J. Swords, a Kansas City-based banking analysis firm, said that once a bid is accepted, the buyer will have to get regulatory approval to form a new holding company and to acquire the bank or to transfer ownership of the existing holding company.
Mills said Lawrence is an attractive market but that only a few existing Kansas banks and their holding companies have the capital position to acquire LNB. Mills said his short list of able bidders would include three Wichita banking concerns: Fourth Financial Corp, which owns Bank IV, and the Emprise Bank group, both of which have small branches in Lawrence, and First Bancorp of Kansas, which owns First National Bank of Wichita.
The Brozman estate, which has been valued at $89.4 million, sought permission to sell its banks to satisfy debts of $83.6 million. The estate's obligations include $23.1 million in secret loans that are the subject of a Federal Bureau of Investigation probe for possible fraud.