Bankruptcy judge OKs CIB's reorganization plan
CHAMPAIGN – Central Illinois Bank's parent company has received approval from bankruptcy court for a prepackaged plan of reorganization under Chapter 11 of the bankruptcy code.
As a result, CIB Marine Bancshares should be able to emerge from Chapter 11 bankruptcy by year's end, said John Hickey Jr., the company's chairman and CEO.
"We can now move to a new chapter in the process – from Chapter 11 to Chapter 12," Hickey quipped. "We can move forward and concentrate on managing the bank and its affairs."
The plan of reorganization approved Thursday allows the bank holding company to convert debt it had issued into preferred stock. That move is expected to reduce expenses, lessen debt and strengthen the company's capital position.
"We are pleased that the judge saw the benefits of our proposed plan of reorganization," Hickey said.
CIB Marine Bancshares, based in Pewaukee, Wis., is the holding company for the bank that operates as Central Illinois Bank in mid-state Illinois and as Marine Bank in the Milwaukee area, Indianapolis and Scottsdale, Ariz.
The bank and its branches are not affected by the holding company's reorganization efforts, Hickey said.
The company previously said that when it completes the reorganization, it will renew its search for a strategic partner with which to combine.
Before CIB Marine Bancshares could file the prepackaged plan of reorganization, the company had to receive approval from holders of its trust preferred securities. Those holders agreed to exchange their debt securities for preferred stock.
Central Illinois Bank, based in Champaign, has two offices each in Champaign and Peoria and one each in Urbana, Sidney, Danville, Monticello, Decatur, Bloomington, Arrowsmith and East Peoria. As of June 30, the bank had assets of $814 million.
Neither CIB Marine Bancshares nor Central Illinois Bank is associated with Marine Bank, Springfield, which has an office in Champaign.
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