To be sure, Seaway Bank had been in talks years ago with Highland Community Bank to by them out but they never appeared to get together on a deal. And Seaway had already acquired two banks in 2010 and 2011 who were failing so Seaway isn't in the running this time.
A would-be savior has emerged for foundering Highland Community Bank, one of just three black-owned banks left in Chicago.
But the definitive agreement from the parent of startup Generations Community Bank to acquire Highland, announced today, is subject to raising at least $8 million in equity both to absorb loan losses at Highland and to capitalize it to grow.
Matthew Roth, the former Harris Bank executive who has pursued starting up a minority-focused community lender on the South Side for several years, said in an interview that he and his team believe they understand the depth of the loan problems at Highland. He declined to say how much he thinks he needs to raise from investors, but one person familiar with Highland said it's at least $8 million and probably more.
Mr. Roth, who would run the newly named Generations Community Bank as president and CEO if the deal closes, said he hopes to complete the capital raise and garner regulatory approvals in the early third quarter.
“We feel optimistic about our prospects to raise the capital,” he said. “It's ambitious, but we think we can get there.”