Citizens Bancshares, the parent company of Citizens Trust Bank, has received a $7.46m investment from the U.S. Department of the Treasury under the troubled asset relief programme’s capital purchase programme.
The capital purchase programme (CPP) is a voluntary programme designed to assist financial institutions in increasing the flow of financing to U.S. businesses and consumers as a way of stimulating the U.S. economy. The CPP is available to bank holding companies, financial holding companies, insured depository institutions and savings and loan holding companies that engage solely or predominately in activities that are permissible for financial holding companies under relevant law.
Under the CPP, the company has issued 7,462 shares of a fixed rate cumulative perpetual preferred stock, series A, with a $1,000 per share liquidation value to the Treasury.
According to James Young, president and CEO of Citizens Bancshares, the additional capital provided through the CPP will enhance the company’s balance sheet and its ability to pursue its disciplined growth strategy which includes expanding existing customer relationships, adding new customers and pursuing future strategic acquisition opportunities.
Mr. Young said: In addition to our already well-capitalised position under current regulatory guidelines, this new equity will enhance our competitive position and increase our capacity to lend.
