United Western Bank, a federal savings bank subsidiary of United Western Bancorp, has purchased the lead participation (in an amount of $750,000) in a $62m non-performing commercial construction loan from FDIC as the receiver for BankFirst, which was closed by the South Dakota Division of Banking on July 17, 2009.
The purchase of the loan participation closed on May 4, 2010. The bank was the successful bidder on the loan participation though the FDIC auction process. The bank already owned a $2.8m loan participation in the construction loan. Last year, the bank charged off the entire balance of this loan participation.
By acquiring the lead participation, the bank will service the loan for itself and a consortium of 44 other loan participants, with the goal of providing a recovery for the participants, including the bank.
Guy Gibson, chairman of the company’s board of directors at United Western Bancorp, said: “We were pleased that we were the winning bidder during the FDIC auction for this loan and that we purchased this loan from the FDIC, as receiver. By being the servicer of this loan, we can manage the workout process which should hopefully result in a benefit to each of the loan participants, including our bank.”