SAN FRANCISCO, March 26, 2024 (GLOBE NEWSWIRE) -- Hagens Berman urges The Bancorp, Inc. (NASDAQ: TBBK) investors who suffered substantial losses to submit your losses now.
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The Bancorp, Inc. (NASDAQ: TBBK) Investigation:
On Mar. 21, 2024, The Bancorp shares sharply declined after activist short seller Culper Research took aim at the bank holding company, alleging that TBBK has misrepresented the quality of its real estate bridge loan (“REBL”) portfolio and contending that TBBK’s related loss reserves are woefully inadequate.
Culper’s detailed allegations have led prominent investors’ rights law firm, Hagens Berman, to open an investigation into possible securities law violations.
The report, entitled “The Bancorp Inc. (NASDAQ TBBK): Bridge to Nowhere,” is based on Culper’s loan-by-loan analysis, visits to 21 different TBBK-funded properties in the past 2 weeks, conversations with former TBBK employees including a REBL underwriter, and conversations with several TBBK borrowers/syndicators.
As but one example, Culper points out that even though an unnamed borrower on a $39.4 million REBL loan collateralized by an apartment complex in Texas had not made interest-only payments for the past 3 months, TBBK nonetheless has made zero reserves against this loan. Culper observed that the Texas complex is only 47% occupied, rendering agency refinancing a non-starter.
Culper further states that “TBBK’s book also appears rife with unsophisticated syndicated borrowers[]” with “‘get rich quick dreams’ who believed that they could easily rehab units, fill them with tenants, increase rents, and cash out for quick ‘passive’ returns.” But, the analyst continues, “for these properties, none of these things have happened: costs have skyrocketed, vacancies remain high, rents have remained relatively stagnant, and interest rates have more than doubled.” In Culper’s view “TBBK’s $4.7 million in reserves, at just 0.24% of its REBL book, are a total farce.”
In addition, Culper said “[w]e also spoke with a former TBBK REBL underwriter who told us that they might expect TBBK’s losses to be anywhere from 10x to 15x higher than the Company’s actual reserves[.]”
In response, the price of TBBK shares fell $3.63, or down about 10%, on Mar. 21, 2024.
“We’re investigating whether TBBK may have misrepresented or concealed known risks in its real estate bridge loan portfolio,” said Reed Kathrein, the Hagens Berman partner leading the investigation.
If you invested in TBBK and have substantial losses, or have knowledge that may assist the firm’s investigation, submit your losses now »
If you’d like more information and answers to frequently asked questions about the TBBK investigation, read more »
Whistleblowers: Persons with non-public information regarding TBBK should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email TBBK@hbsslaw.com.
About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation law firm focusing on corporate accountability through class-action law. The firm is home to a robust securities litigation practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and fraud. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.
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Contact:
Reed Kathrein, 844-916-0895
