CHICAGO, Dec. 23, 2014 (GLOBE NEWSWIRE) -- Royal Financial, Inc. ("Royal") (OTCBB:RYFL) today announced that the U.S. Bankruptcy Court for the Northern Division of Illinois, Eastern Division, approved a Sale Order for the sale of all of the issued and outstanding shares of common stock of PNA Bank to Royal for a cash purchase price of $1.2 million. As previously announced on November 14, 2014, Royal entered into an Asset Purchase Agreement with FLC Holding Company ("FLC"), an Illinois corporation and a registered savings and loan holding company, to acquire FLC's wholly-owned subsidiary, PNA Bank, a federal savings bank with banking offices in Chicago and Niles, Illinois.
The acquisition remains subject to the terms and conditions set forth in the Asset Purchase Agreement and the provisions of Section 363 of the Bankruptcy Code, which included the receipt of approval of the Bankruptcy Court. Under the provisions of the Sale Order, Royal purchased the acquired assets free and clear of all liens, claims and encumbrances and will assume no liability of FLC. Royal next intends to file the necessary bank merger applications with state and federal banking regulators seeking their approval of the proposed acquisition.
Royal expects the acquisition to close in the second quarter of calendar 2015 following the approval of bank regulators. As part of the transaction, Royal intends to merge PNA Bank with and into Royal's wholly-owned subsidiary, Royal Savings Bank. On a combined basis with PNA Bank, Royal will have approximately $232 million in assets, $156 million in loans and $178 million in deposits and serve the combined market area through a total of five office locations.
"We are pleased with the Court's decision today, which removes the cloud of FLC Holding's bankruptcy from PNA Bank and enables us to move forward with applications for regulatory approval," said Jim Fitch, Chairman of Royal Financial. "This transaction advances execution of our strategic plan to increase value for our shareholders. We are excited by this opportunity to serve PNA Bank's customers and to welcome the staff at PNA Bank to our company."
Royal was advised in the transaction by RP Financial, LC. as financial advisor, and Vedder Price P.C. as legal counsel. FLC was advised by Adelman & Gettleman, Ltd, as legal counsel. A copy of the Sale Order entered by the Bankruptcy Court along with the original Asset Purchase Agreement is available on Royal's website, under "Royal Financial", at www.royal-bank.us, from the OTC Markets' website at www.otcmarkets.com under the ticker RYFL, or from the Clerk of the U.S. Bankruptcy Court.
Royal Savings Bank offers a range of checking and savings products and a full line of home and commercial lending solutions. Royal Savings Bank has been operating continuously in the south and southeast communities of Chicago since 1887, and currently has three branches in Chicago, with lending centers in Homewood and St. Charles, Illinois. Visit Royal Financial, Inc. and Royal Savings Bank at www.royal-bank.us
Forward Looking Statements: This press release may include forward-looking statements. These forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project," or similar expressions. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain and actual results may differ materially from those predicted in such forward-looking statements. Factors that could have a material adverse effect on the operations and future prospects of the Company and the Bank include, but are not limited to, changes in interest rates; the economic health of the local real estate market; general economic conditions; continued credit deterioration in our loan portfolio that would cause us to further increase our allowance for loan losses; legislative/regulatory changes; monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality or composition of the loan and securities portfolios; demand for loan products in our market areas; deposit flows; competition; demand for financial services in our market areas; our ability to integrate the operations of PNA Bank successfully and cost-effectively; and changes in accounting principles, policies, and guidelines. These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements.