CHEVY CHASE, Md., July 17 /EMWNews/ -- The U.S. Bankruptcy Court for the Central District of California today entered an order authorizing the sale by Fremont Investment & Loan (FIL) of its retail banking branches, deposits and certain assets to CapitalSource Bank (in organization), a new California-chartered bank formed by CapitalSource Inc. (NYSE: CSE). CapitalSource Bank previously received regulatory and other approvals for its organization, for the FIL transaction, and for the purchase of CapitalSource loans. CapitalSource expects the Bank to commence operations and to close the FIL transaction and the loan purchase from CapitalSource by Friday, July 25, 2008. "Today represents the penultimate step in our depository strategy and the purchase of deposits of over $5 billion and 22 retail bank branches in California," said John K. Delaney, CapitalSource Chairman and CEO. "We are excited that we can complete this important transaction next week and immediately begin to capitalize on market conditions to originate new commercial loans in CapitalSource Bank," added Delaney. CapitalSource Bank was incorporated in California on June 17, 2008, pursuant to approvals and authority granted by the Federal Deposit Insurance Corporation (FDIC) and the California Department of Financial Institutions (DFI). CapitalSource Bank will commence operations as a robust business with approximately 350 employees, including employees hired from CapitalSource and FIL; total assets of approximately $6.2 billion; deposits of approximately $5.3 billion; and equity capital in excess of $920 million. Pursuant to its business plan approved by the FDIC and the DFI, following the FIL transaction CapitalSource will sell approximately $2.1 billion of loans in its portfolio to the bank. The 22 retail bank branches to be acquired in the transaction are expected to commence operations as branches of CapitalSource Bank following the close of the transaction, which is expected on July 25, 2008. The Company intends to hold a special analyst and investor call following closing of the FIL transaction to provide additional details about CapitalSource Bank and to update its view of market opportunities, strategic direction and the financial outlook for CapitalSource Inc.
About CapitalSource CapitalSource (NYSE: CSE) is a leading commercial lending, investment and asset management business focused on the middle market. CapitalSource manages an asset portfolio, which as of March 31, 2008 was approximately $19.85 billion. Headquartered in Chevy Chase, Maryland, the Company had 535 employees as of March 31, 2008 in offices across the U.S. and in Europe. For more information, visit http://www.capitalsource.com. Forward Looking Statements This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including certain plans, expectations, goals, and projections and including statements about our proposed bank formation and asset purchase and liability assumption, which are subject to numerous assumptions, risks, and uncertainties. All statements contained in this release that are not clearly historical in nature are forward-looking, and the words "anticipate," "assume," "believe," "expect," "estimate," "plan," "will," "look forward," and similar expressions are generally intended to identify forward-looking statements. All forward-looking statements (including statements regarding future financial and operating results and future transactions and their results) involve risks, uncertainties and contingencies, many of which are beyond our control which may cause actual results, performance, or achievements to differ materially from anticipated results, performance or achievements. Actual results could differ materially from those contained or implied by such statements for a variety of factors, including without limitation: the proposed bank transaction, including the asset purchase and liability assumption, may not be completed on the proposed terms and schedule or at all; changes in economic conditions; continued disruptions in credit and other markets; movements in interest rates; competitive pressures on product pricing and services; success and timing of other business strategies; the nature, extent, and timing of governmental actions and reforms; extended disruption of vital infrastructure; and other factors described in CapitalSource's 2007 Annual Report on Form 10- K, and documents subsequently filed by CapitalSource with the Securities and Exchange Commission. All forward-looking statements included in this news release are based on information available at the time of the release. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
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