UCB sells bad loans to Wall St. firm

BLAIRSVILLE - A New York investment firm is buying $100 million worth of United Community Banks' bad commercial and residential mortage loans.

In addition, Fletcher International will become owner of a piece of the Blairsville-based bank by purchasing up to $65 million in bank stock.

"This is a very unique and attractive transaction for United and its shareholders," stated Jimmy Tallent, president and chief executive officer of United. "It allows us to sell $100 million of our more illiquid non-performing assets in our non-Atlanta markets while avoiding any additional charge-offs and credit costs. This is particularly attractive due to the lack of investors in these markets and the difficulty we have experienced in successfully selling lots, raw land, and other properties. This transaction helps to significantly reduce our non-performing assets by about 25%, allowing us to achieve our goal of reducing non-performing assets at the highest economic value to our shareholders while preserving our capital position."

"We have been working with Fletcher on this transaction for some time," Tallent said. "Creating a structure that provides an opportunity for new capital combined with the sale of non-performing assets at book value that is both innovative and strategic. We very much appreciate the commitment by Fletcher and we very much welcome them as shareholders of United."

"Community banks are the engines that power local economies, which, in turn, provide jobs, homes, and security to people around the country," said Denis J. Kiely, Director of Fletcher Asset Management, Inc. "With these concurrent investments, we hope to free capital on United's balance sheet to allow it to continue and expand its investments in its communities and fulfillment of its mission."