Delisted N.O.-based Globe Bancorp Inc. mulling buyout offer

(Editor's note: The following story is from CityBusiness' 2007 Top Public Companies issue, which is on newsstands this week.)

Globe Bancorp Inc. wants its privacy back.

The company, founded in 1937 in New Orleans, became a public company in March 2001. Although its assets appreciated

The parent company of Globe Homestead Savings Bank is still technically public although the only notable stock trade in recent years has involved board members. In February, the company began weighing a buyout offer from a private equity group.

Joe McCarthy III, bank president and corporate chief accounting officer, said attorneys are examining the offer with "due diligence" before it is presented to shareholders. He and Globe Bancorp board member Robert Gohres did not identify parties involved or an asking price.

"The board is keeping an open mind and taking into account all options," McCarthy said. "We were approached and (the board) decided to look into it further as a sale to local investors."

Globe maintained a stable asset base in the past five years, reporting just less than $30 million to the Federal Deposit Insurance Corp. March 31. That's only 9 percent off the five-year high of $33 million in the first quarter of 2003. Assets dropped to $29.5 million in third quarter 2004 but have hovered near $30 million ever since.

McCarthy said the savings association's business cycle since Hurricane Katrina started with a loan payoff period from borrowers with insurance proceeds, followed by loan demand for those who needed to buy a new home.

"Then you had another subsequent payoff period with the release of SBA money, and continuing into Road Home money," he said.

New mortgage activity has been "kind of flat," McCarthy said. He pins housing doldrums on potential homeowners waiting to see if prices and availability of insurance improves through what he hopes is another uneventful hurricane season.

"In the past you could look at this business with seasonal activity, sometimes based on the school year or certain holidays," said McCarthy. "Now it's kind of built around hurricane season.

"Before it was, 'How much to I make and what is the interest rate?' Now it's, 'Can I get insurance? How much is it?'"

Credit: Greg LaRose