BankFirst in Manitowoc, Wis., reported a significant increase in net income after the sale of a minority stake in a tech services company offset one-time losses elsewhere.
The $4.2 billion-asset company said in a press release that its fourth-quarter profit nearly tripled that of a year earlier, to $34.9 million. The results were largely due to the $38.9 million pretax gain the company received from selling its member interest in UFS LLC.
Several other items weighed down the quarterly results, including the decision to sell $50 million of U.S. Treasury securities at a $7.8 million loss. Proceeds were reinvested in short- and long-term investments, which should increase annual interest income by $1.8 million.
Bank First vacated the former headquarters of Hometown Bancorp, a Fond Du Lac, Wis., banking company it bought last year, moving the property to other real estate owned. That move, combined with revaluing four other OREO properties, led to a $1.6 million loss on OREO valuations.
The company also said it plans to close a branch in the first quarter, moving it to OREO in a move that will impair the cost basis of the building by $400,000.
Finally, Bank First repayed $11.5 million of subordinated debt and redeemed $8.3 million of debt securities it inherited from Hometown. The company plans to redeem another $4.1 million of Hometown-related debt securities.
While the redemptions will lower future interest expense by more than $1.1 million annually, they also led to the accelerated amortization of $1.4 million in fair value adjustments assigned to the debt when they were acquired in the Hometown deal.