Lakeland Financial, the parent company of Lake City Bank, has agreed to participate in the US Treasury’s capital purchase program and has sold preferred, non-voting shares of stock valued at $56 million to the Treasury Department under the terms of the program.
The Treasury also received warrants to purchase shares of the company’s common stock. The Treasury announced the capital purchase program (CPP) in October 2008, which encourages financial institutions to build capital to help increase the flow of financing to businesses and consumers in order to support the economy.
Michael Kubacki, chairman, president and CEO of Lakeland Financial, said: While we have made the decision to participate in the program, it is our intention to consider appropriate funding alternatives to plan for the redemption of this preferred investment as soon as practical and allowable by our primary regulator.
We have always been focused on creating sustainable and long-term value for common shareholders and we believe that redemption at the earliest possible time with appropriate terms will be in the best interests of these shareholders. We will work toward redemption on terms that will maintain the capital strength of our balance sheet and provide for continued success in the future for the company and its common shareholders.
