By Becky Yerak |
The California-based investors in troubled First Chicago Bancorp plan to
boost their stakes in the $1.14 billion-asset bank to 85 percent from
46.6 percent, according to Federal Reserve records.

The bank couldn’t be reached for immediate comment, but, last month,
First Chicago Bancorp, parent of First Chicago Bank & Trust, said it
expected to complete a second offering of stock this quarter to raise
needed capital.

The bank lost $7.6 million in the first quarter, and it was ordered by U.S. and state banking regulators in March to strengthen management, improve lending procedures and reduce its reliance on commercial real estate.

The Chicago-based company also was to submit a plan within 60 days to “maintain sufficient capital,” though its bank is at least adequately capitalized.

In a statement last month, First Chicago Bancorp noted that like many Chicago banking companies, it has been confronting “significant credit quality challenges during the recession.”

“To respond to these challenges and maintain the financial condition of the company and its subsidiary First Chicago Bank & Trust, in September of 2009 the company raised $43.5 million of new capital through the sale of common stock,” the company said. “First Chicago has continued to pursue additional capital for the company and the bank, and expects to complete a second offering of stock during the current quarter.”

The bank must stop accepting new brokered deposits and must not pay any dividends without regulatory approval, according to the March agreement.

Its previous capital raise was from existing investors.

According to Federal Reserve records, the parties that plan to boost their First Chicago Bancorp stakes are Castle Creek Capital Partners III LP, Castle Creek Capital III LLC, Eggemeyer Capital LLC, Ruh Capital LLC and Legions IV Advisory Corp, all of Rancho Santa Fe, Calif.