Transformative Acquisition Includes Expected Deposits of
Approximately $785 Million and Expected Assets of Approximately $1.7
Billion, Increases Branches to 43, and Broadens Market Opportunities
SAN JUAN, Puerto Rico--(BUSINESS WIRE)--
Oriental Financial Group Inc. (the "Company") (NYSE: OFG) today
announced that its commercial bank subsidiary, Oriental Bank and Trust
("Oriental"), has acquired all of the retail deposits and substantially
all of the assets and operations of Eurobank from the Federal Deposit
Insurance Corporation, as receiver of Eurobank.
Jose Rafael Fernandez, President, CEO and Vice Chairman of the Board of
the Company, said "This transaction helps restore normalcy to the Puerto
Rico banking industry and represents a transformative event for Oriental
-- one that maintains Oriental's historic financial strength while
providing new growth opportunities. This transaction significantly
enhances Oriental's position in Puerto Rico and is very much in line
with our strategy to expand the integrated delivery of our services to
mid and high net worth clients, and to increase our mix of loans
relative to investment securities."
"We warmly welcome our new customers -- the consumers and businesses
previously served by Eurobank," continued Mr. Fernandez. "From your
point of view, it will be business as usual. Your deposits are now held
in a well capitalized bank with a 46-year history of strength, service
and stability. And your deposits remain insured by the FDIC to the
fullest extent permitted by law. We are also very excited to welcome
Eurobank's employees to the Oriental team.
"Oriental has a culture that treasures its customer relationships. We
pride ourselves in helping our customers manage their finances through
Oriental's advisory model of delivery. We are flexible and nimble in our
service delivery. And we employ advanced technology that enables us to
provide for smooth and efficient operations. Representatives of Oriental
are at all branches to assist you, should you have any questions."
Under Oriental's agreement with the FDIC, Oriental assumed expected
deposits of approximately $785 million and expected assets of
approximately $1.7 billion, including an approximately $1.58 billion
loan portfolio which will be subject to a loss sharing arrangement
pursuant to which the FDIC will bear 80% of qualifying losses. As part
of this transaction, the Company issued to the FDIC a value appreciation
instrument. Additionally, Oriental will issue to the FDIC a promissory
note in the amount of approximately $715.5 million to be repaid within
one year of closing, subject to up to 4 one-year renewals. The note
covers a portion of the excess of assets acquired over the liabilities
assumed, rather than requiring Oriental to pay cash for such amount. The
remaining amount of such excess, which is expected to be approximately
$100 million, will be paid in cash.
The Company and Oriental were advised on this transaction by Keefe,
Bruyette & Woods, Inc., as financial advisor, and Skadden, Arps, Slate,
Meagher & Flom LLP and McConnell Valdes LLC, as legal advisors.
Eurobank customers who have questions about today's transaction can call
the FDIC toll-free at 1-800-591-2903. The phone number will be
operational this evening until 9:00 p.m., Atlantic Standard Time (AST);
on Saturday from 9:00 a.m. to 6:00 p.m., AST; on Sunday from noon to
6:00 p.m., AST; and thereafter from 8:00 a.m. to 8:00 p.m., AST.
About Oriental Financial Group
Oriental Financial Group Inc. is a diversified financial holding company
operating under U.S. and Puerto Rico banking laws and regulations. Now
in its 46th year in business, Oriental provides a full range
of mortgage, commercial and consumer banking services through 43
Oriental Group financial centers in Puerto Rico, as well as financial
planning, trust, insurance, investment brokerage and investment banking
services. Investor information about Oriental can be found at www.orientalfg.com.
Forward-Looking Statements
This press release contains certain forward-looking information about
Oriental Financial Group that is intended to be covered by the safe
harbor for "forward-looking statements" provided by the Private
Securities Litigation Reform Act of 1995. All statements other than
statements of historical fact are forward-looking statements. Such
statements involve inherent risks and uncertainties, many of which are
difficult to predict and are generally beyond the control of Oriental
Financial Group. Oriental Financial Group cautions readers that a number
of important factors could cause actual results to differ materially
from those expressed in, or implied or projected by, such
forward-looking statements. If any of these risks or uncertainties
materializes or if any of the assumptions underlying such
forward-looking statements proves to be incorrect, Oriental Financial
Group's results could differ materially from those expressed in, or
implied or projected by such forward-looking statements. Oriental
Financial Group assumes no obligation to update such forward-looking
statements, except as required by law. For a more complete discussion of
risks and uncertainties, investors and security holders are urged to
read the section titled "Risk Factors" in Oriental Financial Group's
Annual Report on Form 10-K and any other reports filed by it with the
SEC. The documents filed by Oriental Financial Group with the SEC may be
obtained at the SEC's website at www.sec.gov.
These documents may also be obtained free of charge from Oriental
Financial Group by directing a request to: Oriental Financial Group
Inc., Investor Relations c/o Anreder & Company, 286 Madison Avenue,
Suite 907, New York, NY 10017; telephone: (212) 532-3232 or (800)
421-1003; fax: (212) 679-7999; e-mail: ofg@anreder.com.
Source: Oriental Financial Group Inc.
Contact: Puerto Rico:
Oriental Financial Group Inc.
Marilyn Santiago-Colon, 787-993-4648
or
U.S.:
Anreder & Company
Steven Anreder and Gary Fishman, 212-532-3232