Nov. 29 (Bloomberg) -- First Republic Bank, the San Francisco lender sold to private-equity firms by Bank of America Corp. at midyear, plans to raise about $280.5 million from an initial public offering.
First Republic will sell 11 million shares at $24 to $27 each, according to a statement from the company today. After deducting fees, expenses and cash that goes to selling shareholders, proceeds to the company would be $92.4 million, assuming an offering price of $25.50, according to the firm. Owners include General Atlantic LLC and Colony Capital LLC.
Investors paid $1.86 billion for First Republic, according to the bank’s offering. Bank of America, the biggest U.S. lender by assets, gained control of the firm when it took over Merrill Lynch & Co. in January 2009. Merrill Lynch paid $1.8 billion for the bank in 2007.
First Republic had $22 billion in assets and $19 billion in deposits as of Sept. 30, according to the statement. Bank of America has $2.34 trillion in assets.
Institutional and individual holders are selling 7 million shares, while the firm will offer 4 million. General Atlantic and Colony Capital, which each owns 21.8 percent, are both selling a 2 percent stake. Other holders selling shares include Wellington Management Co., Pine Eagle LLC and GL Partners LP.
Big Board Listing
The firm is seeking a listing on the New York Stock Exchange under the ticker FRC, according to its announcement of the offering. First Republic won’t pay cash dividends on common shares in the “foreseeable future,” the company said.
First Republic said in the offering that its foreclosure process is sound and it hasn’t needed to halt sales of foreclosed homes. Banks including JPMorgan Chase & Co. and Bank of America stopped property seizures in September and October to examine cases of so-called “robo-signing,” when employees signed foreclosure documents without personally checking that they were accurate.
First Republic will use proceeds from the sale “for general corporate purposes, which may include, among other things, funding loans or purchasing investment securities for our portfolio,” the firm said in the filing.
The sale may be priced as early as Dec. 6, according to data compiled by Bloomberg. Charlotte, North Carolina-based Bank of America, New York-based Morgan Stanley and New York-based JPMorgan are managing the sale.
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