published Thursday, November 24th, 2011

Preferred shares at bank see profit

Cornerstone Bancshares Inc. will pay its fourth consecutive quarterly dividend to its preferred shareholders next week after the Chattanooga bank reported three consecutive quarters of profits.

Although Cornerstone continues to operate under a federal consent order, the bank earned $917,000, or 9 cents per share, in the first nine months of 2011. Cornerstone announced Wednesday that preferred stockholders as of June 30 will be paid a quarterly dividend next Tuesday of 62.5 cents per share.

The bank has issued more than $7.5 million of preferred stock, or about half of its original goal of a $15 million offering, to recapitalize Cornerstone after losses in 2008 and 2009. Launched in the fall of 2010 and extended through the end of this year, the preferred stock offering features a new class of security with a 10 percent cumulative annual dividend, and is convertible into common stock after five years.

“We are extremely pleased with the progress of the bank and are thankful that the earnings are sufficient to pay this preferred dividend,” Cornerstone President Frank Hughes said.

Cornerstone, a bank holding company with five offices and $426 million in assets, should do better than many banks because of the strength of the Chattanooga area economy, Cornerstone Chairman Miller Wellborn said.

“With recent investments by Volkswagen, Amazon, Wacker and other major corporations in Chattanooga, prospects for the local economy are very bright indeed,” Wellborn said.

about Staff Report...

Get breaking news from the Times Free Press on Twitter at www.twitter.com/timesfreepress or by visiting us on Facebook or Twitter at the right:

Comments do not represent the opinions of the Chattanooga Times Free Press, nor does it review every comment. Profanities, slurs and libelous remarks are prohibited. For more information you can view our Terms & Conditions and/or Ethics policy.
please login to post a comment

Other National Articles

videos »         

photos »         

e-edition »

advertisement
advertisement

Find a Business

400 East 11th St., Chattanooga, TN 37403
General Information (423) 756-6900
Copyright, Permissions, Terms & Conditions, Privacy Policy, Ethics policy - Copyright ©2014, Chattanooga Publishing Company, Inc. All rights reserved.
This document may not be reprinted without the express written permission of Chattanooga Publishing Company, Inc.