Bank acquisition hits snag

A Clearwater bank's $260 million proposed deal to acquire a digital banking services company with a focus on millennials is on the verge of collapsing.

Clearwater-based Flagship Community Bank signed a deal to buy BankMobile, a division of Wyomissing, Pa.-based Customers Bancorp, in February. BankMobile provides digital banking services to college students, among other sometimes underbanked demographics.

But financing for the deal hasn't materialized, according to recent statements from Customers Bancorp and Flagship officials. “Since Flagship was unable to raise all the required capital needed to complete the acquisition ... we are now considering restructuring the transaction as a tax free spinoff of BankMobile to Customers Bancorp shareholders,” Customers Bancorp officials say in a public filing.

Customers Bancorp officials, in the disclosure statement, add that in the past few weeks the bank has received two unsolicited, all-cash proposals for BankMobile, both of which could top the original Flagship offer.

Flagship addressed the issue in a June 6 letter to shareholders from Flagship Chairman, President and CEO Frank Burke. “Under any alternative scenario,” writes Burke, “Flagship's priority would still include offering at least the same level of liquidity to Flagship shareholders as provided in the original agreement.”

Burke referred all questions on the sale to the shareholder's letter, which states bank officials hope to make a decision on any alternative options for BankMobile within two months.