(MM) (FSGI) Quote

FSGI closed at $2.25.

Atlantic Capital Bancshares Announces Merger Agreement with First Security Group (3/25/15)

Will Create Premier Southeastern Bank Focused on Business and Private Banking

ATLANTA & CHATTANOOGA, Tenn.--(BUSINESS WIRE)--Atlantic Capital Bancshares, Inc. (“Atlantic Capital”) and First Security Group, Inc. (NASDAQ: FSGI) (“First Security” or “FSG”) jointly announced today the signing of a definitive merger agreement pursuant to which Atlantic Capital will acquire First Security. The transaction has been unanimously approved by the boards of directors of each company. Atlantic Capital is a bank holding company headquartered in Atlanta, Georgia and the parent of Atlantic Capital Bank. First Security is a bank holding company headquartered in Chattanooga, Tennessee and the parent of FSGBank, N.A. (“FSGBank”).

Under terms of the merger agreement, Atlantic Capital will purchase First Security for total consideration of approximately $160 million. FSG shareholders may elect cash equal to $2.35 per share, stock based on a fixed exchange ratio of 0.188 shares of Atlantic Capital common stock for each FSG share or any combination thereof. FSG shareholder elections may be adjusted as necessary to result in an overall ratio of 40 percent cash and 60 percent stock. Atlantic Capital intends to register its shares with the SEC and seek a listing on NASDAQ concurrent with closing of the transaction.

In conjunction with the merger, Atlantic Capital has signed a stock purchase agreement with Trident IV, L.P. and Trident IV Professionals Fund, L.P., investment funds managed by Stone Point Capital LLC, for a $25.0 million private placement of Atlantic Capital common stock at $12.60 per share, which is expected close upon completion of the merger, subject to regulatory approvals and other customary conditions. The net proceeds of the private placement, combined with holding company cash and alternative sources of debt financing, will be used to fund the cash portion of the merger consideration. Aggregate shares outstanding following the merger and private placement are expected to be approximately 23.0 million.

Upon completion of the transaction, the combined company is expected to have approximately $2.7 billion in assets, $2.2 billion in deposits and $1.9 billion in net loans. Atlantic Capital will be based in Atlanta with the bank maintaining corporate offices in Atlanta and Chattanooga. Banking offices will continue to operate under their current brands.

Douglas L. Williams, Chief Executive Officer of Atlantic Capital, will be CEO of the combined entity, with D. Michael Kramer, Chief Executive Officer of First Security, serving as President and Chief Operating Officer. Both will serve on the board of directors, which will be chaired by the current Atlantic Capital Chairman Walter M. Deriso, Jr.

“Atlantic Capital focuses on corporate banking to small and mid-sized companies, which is perfectly compatible with FSG’s strategy and focus on small business and commercial banking,” Mr. Kramer said. “Likewise, the ability to market FSG’s core competencies in the ninth largest metropolitan area in the U.S. will provide significant opportunities for enhanced revenue and growth.”

The transaction is expected to achieve significant financial benefits for shareholders. Through the identified cost synergies, Atlantic Capital expects the transaction to be neutral to estimated pro forma earnings in the first full year of combined operations, with significant earnings accretion projected thereafter. The merger will create a financial institution well positioned to achieve its targeted financial performance objectives of a 1 percent return on average assets and 12 percent return on average tangible common equity within 24 months of closing.

From a capital perspective, future balance sheet growth is projected to be supported by a strong capital base established at the completion of the merger as well as ongoing earnings. The pro forma consolidated tangible common equity to tangible assets ratio is estimated to exceed 9.0 percent; the consolidated Tier 1 leverage ratio is projected to total approximately 8.0 percent; and the consolidated total risk-based capital ratio is expected to exceed 11.0 percent.

“Our goal is to build a premier financial institution in the Southeast by focusing on business and private banking,” said Mr. Williams. “Each bank brings complementary strengths that will only be enhanced by the combined size and geographic reach of the merger. The merger will provide the foundation for a strong financial institution that will produce solid returns for our shareholders.”

The transaction is expected to close late in the third quarter or early in the fourth quarter of 2015 and is subject to Atlantic Capital and First Security stockholder approval, regulatory approval and other conditions set forth in the merger agreement. Pursuant to the agreement’s terms, Atlantic Capital Bank will merge with and into FSGBank.

Atlantic Capital engaged Macquarie Capital as its financial advisor and Womble Carlyle Sandridge & Rice, LLP as its legal advisor. First Security was advised by the investment banking firm of Sandler O’Neill + Partners, L.P. and the law firm of Bryan Cave LLP.

About Atlantic Capital Bancshares, Inc.

Atlantic Capital is a bank holding company headquartered in Atlanta, Georgia. Atlantic Capital was founded in 2007 through the then-largest equity capital raise in U.S. history by a de novo bank holding company. Atlantic Capital’s wholly-owned bank subsidiary, Atlantic Capital Bank, has grown to $1.3 billion in assets with a single office and significant investments in technology, talent and customer service. Atlantic Capital Bank serves privately held small- and mid-size companies and not-for-profit organizations; institutional-caliber commercial real estate developers and investors; and individuals throughout metropolitan Atlanta.

About First Security Group, Inc.

First Security Group is a bank holding company headquartered in Chattanooga, Tennessee, with $1.1 billion in assets. Founded in 1999, First Security’s community bank subsidiary, FSGBank, has 26 full-service banking offices in east and middle Tennessee and north Georgia. FSGBank provides retail and small business banking services, trust and investment management, mortgage banking, financial planning, and internet banking (www.fsgbank.com).

http://www.businesswire.com/news/home/20150325006384/en/Atlantic-Capital-Bancshares-Announces-Merger-Agreement-Security#.VRMeMoktGUk

First Security Group Announces Third Quarter Profits

Date : 10/28/2014 @ 8:00AM
Source : Business Wire
Stock : First Security Grp., Inc. (MM) (FSGI)
Quote : $2.01 -0.01 (-0.50%) @ 6:30PM

Strong Deposit and Loan Growth Achieved

First Security Group, Inc. (NASDAQ: FSGI) (“First Security” or “FSG”) reported net income for the third quarter of 2014 of $927 thousand, or $0.01 per basic and diluted share, and $1.5 million for the nine months ended September 30, 2014, or $0.02 per basic and diluted share.

[....]

http://ih.advfn.com/p.php?pid=nmona&article=64193813

First Security Group, Inc. announces the termination of the written agreement with the Federal Reserve Bank of Atlanta (10/07/14)

Under the terms of the Written Agreement, the Company was required to, among other things: (i) serve as a source of strength to FSGBank, National Association, its wholly owned subsidiary bank ("FSGBank"); (ii) refrain from declaring or paying any dividend, or taking dividends or other payments representing a reduction in FSGBank's capital; (iii) refrain from incurring, increasing or guaranteeing any debt, directly or indirectly; (iv) submit to the Federal Reserve a written plan to maintain sufficient capital at the Company on a consolidated basis; (v) comply with certain regulatory notice provisions pertaining to the appointment of any new director or senior executive officer, or the changing of responsibilities of any senior executive officer; and (vi) comply with certain regulatory restrictions on indemnification and severance payments. The Company was also required to submit certain reports to the Federal Reserve with respect to the foregoing requirements. The above description of the Written Agreement is qualified in all respects by reference to the actual language of the Written Agreement, which was originally filed as Exhibit 10.1 to a Current Report on Form 8-K on September 14, 2010.

While the Written Agreement has been terminated, the Company expects that it will continue to seek approval from the Federal Reserve prior to paying any dividends on its capital stock and incurring any additional indebtedness.

http://www.sec.gov/Archives/edgar/data/1138817/000113881714000066/a20141007_frbxwaxterminati.htm

Book value $1.30 per share at 6/30/14.

First Security Group Announces Return to Profitability (8/05/14)

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--First Security Group, Inc. (NASDAQ: FSGI) (“First Security” or “FSG”) today reported net income for the second quarter of 2014 of $613 thousand, or $0.01 per basic and diluted share, as compared to a loss of $45 thousand in the first quarter of 2014, or $0.00 per basic and diluted share. Loans increased by $54.7 million, or 9.0% (36.2% annualized), since March 31, 2014 and $117.5 million, or 21.7%, since June 30, 2013.

“We are pleased to have achieved core profitability in the second quarter. We believe that we have reached an inflection point in our recovery and that barring any unforeseen events, First Security is on a path to healthy profitability built on a strong, and improving, balance sheet,” said Michael Kramer, First Security’s President and Chief Executive Officer. “Our loan growth, combined with improvements in our deposit mix and enhancements to our non-interest income, are all on positive trajectories to produce both sustainable and increasing profitability.”

The below discussion of First Security’s results of operations and financial condition is supplemented by the accompanying financial highlights.

Net Interest Income

For the second quarter of 2014, net interest income improved by $620 thousand, or 9.0%, to $7.5 million compared to $6.9 million for the first quarter of 2014. Interest income on loans, including fees, increased by $656 thousand while total interest income increased by only $514 thousand due to reduction in the investment security portfolio. During the first and second quarters of 2014, First Security sold approximately $64.5 million of lower yielding investment securities to redeploy into loans. Total interest expense improved by $106 thousand through reductions in the cost of deposits partially offset by the increase in total deposits. For the second quarter of 2014, the net interest margin improved by 9 basis points to 3.30% compared to 3.21% in the first quarter of 2014.

Loans

Loans totaled $659.5 million as of June 30, 2014, a $54.7 million increase, or 9.0% (36.2% annualized), from the March 31, 2014 total of $604.9 million, and a $76.4 million increase, or 13.1% (26.1% annualized), from the December 31, 2013 total of $583.1 million. The main categories of loan growth during the first six months of 2014 included: commercial real estate by $49.6 million, or 18.9%; construction and land development by $12.8 million, or 32.2%; and commercial loans by $10.6 million, or 19.2%. The growth in commercial real estate is primarily reflective of First Security’s Tri-Net Direct line of business, which provides interim and long-term financing to professional developers and private investors of commercial real estate on long-term leases to tenants that are investment grade or have investment grade attributes.

Deposits

During the second quarter, First Security continued to improve its deposit mix to reduce the overall cost of deposits from 0.65% for the first quarter of 2014 to 0.59% for the second quarter of 2014. Average pure deposits, defined as transaction accounts, for the second quarter of 2014 accounted for 54.1% of average total deposits as compared to 53.0% for the first quarter of 2014. As of June 30, 2014, pure deposits totaled $485.2 million which is $29.8 million greater than the average balance during the second quarter as solid growth was achieved late in the second quarter. Average core deposits, defined as transaction accounts plus retail CDs, remained steady at 74.0% of average total deposits during the second quarter. Brokered deposits increased by a net $14.5 million from March 31, 2014 to June 30, 2014 to $87.0 million. This increase includes $17.7 million of customer deposits placed and reciprocated through FSG's CDARS® and Insured Cash Sweep® products.

Non-Interest Income

Non-interest income totaled $3.0 million for the second quarter of 2014 compared to $2.6 million for the first quarter of 2014. FSG reported $450 thousand in net gains on sales of loans during the second quarter as compared to $22 thousand in the first quarter of 2014. This represents the aggregate gains from First Security’s SBA lending department as well as gains from $12.5 million of the $33.6 million of commercial real estate loans that were transferred to held-for-sale as of March 31, 2014. First Security expects to sell the remaining $21.1 million during the third quarter of 2014. Additionally, income from mortgage banking increased by $99 thousand to $279 thousand in the second quarter of 2014.

“Since the low water mark for loan balances on September 30, 2013, we have increased our loan portfolio by nearly $125 million in the last nine months,” said John Haddock, First Security’s EVP and Chief Financial Officer. “In addition to the loan growth, we realized $450 thousand in gains from loan sales during the quarter. Given the specialized nature of these loans, and our embedded capacity, we believe these gains will prove to be recurring over time.”

Non-Interest Expense

Non-interest expense decreased by $344 thousand to $10.1 million for the second quarter of 2014 as compared to the first quarter of 2014. Total non-performing asset costs, including write-downs, net gains or losses and associated expenses, declined by $295 thousand in the second quarter of 2014. As of June 30, 2014, full-time equivalent employees declined to 264 as compared to 275 as of March 31, 2014 and 327 as of June 30, 2013. Salary expense remained consistent in the second quarter as compared to the first quarter.

Asset Quality

First Security recorded a $270 thousand negative provision to adjust the allowance for loan losses to First Security’s current estimate of $9.4 million as of June 30, 2014. The ratio of the allowance to total loans declined from 1.52% as of March 31, 2014 to 1.43% as of June 30, 2014. Total non-accrual loans declined by $1.1 million, or 18.8%, to $4.9 million as of June 30, 2014 compared to March 31, 2014. NPAs to total assets as of June 30, 2014 improved to 1.35% compared to 1.42% as of March 31, 2014.

Capital

Stockholders’ equity as of June 30, 2014 totaled $86.6 million, a $1.9 million increase from March 31, 2014. As of June 30, 2014, book value per share increased to $1.30 per share compared to $1.27 per share as of March 31, 2014.

“The recent announcement of the $600 million Volkswagen expansion in Chattanooga that includes an estimated 2,000 direct and 3,600 indirect jobs as well as the South’s first automotive research and development center speaks volumes to the economic activity and growth potential within our east Tennessee markets,” said CEO Kramer. “We believe that we are uniquely positioned to build a successful community bank that provides solid returns to its shareholders while serving the banking needs of its communities.”

About First Security Group, Inc.

First Security Group, Inc. is a bank holding company headquartered in Chattanooga, Tennessee, with $1.0 billion in assets. Founded in 1999, First Security’s community bank subsidiary, FSGBank, N.A. has 26 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia. FSGBank provides retail and commercial banking services, trust and investment management, mortgage banking, financial planning, internet banking (www.FSGBank.com).

http://www.businesswire.com/news/home/20140805005568/en/Security-Group-Announces-Return-Profitability#.U-DOFYl0yUk

FSGI very active near the close/after-hours trading.

FSGI 5% Shareholders:

GF Financial II, LLC
6,080,000
9.12%

MFP Partners, L.P.
6,080,000
9.12%

Ulysses Partners, L.P.
6,000,000
9.00%

Forest Hill Capital LLP
4,408,847
6.61%

EJF Capital LLC
4,391,481
6.59%

http://www.sec.gov/Archives/edgar/data/1138817/000113881714000033/a20140423_proxy.htm

Banktracker snap-shot

http://banktracker.investigativereportingworkshop.org/banks/tennessee/chattanooga/fsgbank-national-association/

First Security Group, Inc.

Chattanooga, TN

TARP Transactions

Original TARP investment amount: $33,000,000.00 (on Jan. 9, 2009)
Outstanding investment $0.00 (Footnote 87)

Total cash back: $16,315,362.00 (May include dividends and interest payments not shown below)

Investment status: Sold, in full; warrants not outstanding

Repayment of $14,912,862.00 on April 11, 2013 - realized loss of $18,087,138.00

Data current as of Oct. 16, 2013

Footnotes

(87) On 4/11/2013, Treasury completed the exchange of its First Security Group, Inc. (FSGI) preferred stock for common stock, pursuant to an exchange agreement, dated as of 2/25/2013, between Treasury and FSGI, and sold the resulting FSGI common stock, pursuant to securities purchase agreements, each dated as of 4/9/2013, between Treasury and the purchasers party thereto.

http://banktracker.investigativereportingworkshop.org/tarp/tennessee/chattanooga/first-security-group-inc/

Marker:
First Security Grp., (FSGI)
$1.90 down -0.01 (-0.52%)
Volume: 156,515

FSGBank Announces Lifting of Regulatory Enforcement Action (3/11/14)

OCC Terminates Consent Order

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--FSGBank, N.A. (“FSGBank” or the “Bank”) today reported that the Office of the Comptroller of the Currency (the “OCC”) provided written notification of the termination of the Consent Order with FSGBank, the wholly-owned subsidiary bank of First Security Group, Inc. (NASDAQ: FSGI) (“First Security”).

“Since 2012, our Board and management team’s primary goal was to effect the transformation of FSGBank into a premier community bank in East Tennessee,” said Larry Mauldin, Chairman of the Board of Directors of First Security and FSGBank. “Accomplishing this goal required three distinct tasks: raising capital, resolving the asset quality problems, and satisfying the Bank’s Consent Order. Today’s announcement establishes management’s successful execution of all three tasks.”

With the termination of the Consent Order, FSGBank is now considered “well-capitalized” under the FDIC’s prompt corrective action provisions. This designation provides FSGBank with opportunities for enhanced operational efficiencies, including within its liquidity management, mortgage operations and SBA lending operations.

“We have appreciated working with the OCC to resolve the issues identified in the Consent Order,” said Michael Kramer, First Security and FSGBank’s President and Chief Executive Officer. “The lifting of the Consent Order removes significant operational and financial constraints while enhancing our ability to execute our strategic plan. We can now direct more of our time and energy toward returning to core profitability and building long-term shareholder value.”

About FSGBank, N.A. and First Security Group, Inc.

First Security Group, Inc. is a bank holding company headquartered in Chattanooga, Tennessee, with $1.0 billion in assets. Founded in 1999, First Security’s community bank subsidiary, FSGBank, N.A. has 28 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia. In Dalton, Georgia, FSGBank operates under the name of Dalton Whitfield Bank; along the Interstate 40 corridor in Tennessee, FSGBank operates under the name of Jackson Bank & Trust. FSGBank provides retail and commercial banking services, trust and investment management, mortgage banking, financial planning, internet banking (www.FSGBank.com).

http://www.businesswire.com/news/home/20140311006509/en/FSGBank-Announces-Lifting-Regulatory-Enforcement-Action

First Security Group Announces 2013 Earnings (2/25/14)

Strong Fourth Quarter Loan Growth Achieved

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--First Security Group, Inc. (NASDAQ:FSGI) (“First Security” or “FSG”) today reported net income available to common shareholders for 2013 of $11.4 million, as compared to a loss of $39.6 million for 2012. For the fourth quarter of 2013, First Security reported a net loss allocated to common shareholders of $646 thousand, as compared to a $1.4 million loss in the third quarter of 2013 and a $16.1 million loss for the fourth quarter of 2012.

“Last fall, we stated that it was essential to achieve significant improvement in loan and revenue growth,” said Michael Kramer, First Security’s President and Chief Executive Officer. “With nearly $50 million of loan growth and over $1 million of improvement in non-interest expense in the fourth quarter, the momentum towards a return to operating profitability is real and within reach.”

During the fourth quarter of 2013, loans increased $48.5 million, or 9.1% (36.3% annualized) to $583.1 million. Commercial real estate loans increased $39.3 million, residential 1-4 family loans increased $7.1 million and commercial and industrial loans increased $4.5 million.

For the fourth quarter of 2013, net interest income improved by $313 thousand, or 5.1%, to $6.5 million compared to $6.2 million for the linked third quarter of 2013. Total interest income declined by $22 thousand primarily due to lower interest income on investment securities as FSG sold approximately $22.8 million of investment securities to support higher yielding loan growth. As a majority of the fourth quarter loan growth was achieved in the latter half of the quarter, the full income impact will be realized in the first quarter of 2014. Total interest expense improved by $335 thousand through reductions in the costs of deposits as well as reductions in total deposits.

“Taking a step back and reviewing the steady quarterly improvement from each consecutive quarter in 2013, we reduced non-interest expense by at least $1 million each quarter while, at the same time, increasing total revenues (net interest income plus non-interest income) by an average of nearly $500 thousand each quarter,” said John Haddock, First Security’s EVP and Chief Financial Officer. “While we will remain focused on improving our operational efficiencies in 2014, we will also continue to actively restructure our earning asset mix by growing loans and reducing the excess liquidity in our investment portfolio to improve our overall yield and margin.”

During the fourth quarter, First Security continued to improve its deposit mix by deploying excess liquidity to reduce higher cost customer CDs and brokered deposits as they matured and by increasing pure deposits, defined as transaction-based accounts. During the fourth quarter, average customer CDs and brokered deposits decreased by $60.8 million, or 12.3% while pure deposits increased by $7.9 million, or 1.8% (7.1% annualized) to $452.5 million. During the fourth quarter, the changes in deposit mix resulted in the average rate paid on customer deposits improving from 0.56% to 0.48% and the overall cost of deposits improving from 0.84% to 0.74%. As of December 31, 2013, pure deposits totaled 52.0% of total deposits as compared to 40.9% as of December 31, 2012.

With continued asset quality improvement and minimal charge-offs, First Security recorded a $955 thousand negative provision to the allowance for loan and lease losses for the quarter and a $2.7 million negative provision for the year. First Security realized net recoveries of $754 thousand during the fourth quarter of 2013 and $565 thousand in net charge-offs for the year. Nonaccrual loans increased by $400 thousand to $7.2 million as of December 31, 2013, compared to $6.8 million as of September 30, 2013. Nonperforming loans to total loans was 1.39% as of December 31, 2013, as compared to 1.37% as of September 30, 2013. Based on the continued stability in asset quality and the net recoveries, the negative provision was necessary to adjust the allowance for loan losses to the Company’s current estimate of $10.5 million. The ratio of the allowance to total loans declined from 2.00% as of September 30, 2013, to 1.80% as of December 31, 2013.

Non-interest expense decreased by $1.0 million to $10.1 million for the fourth quarter of 2013 as compared to the third quarter of 2013. During the fourth quarter, First Security completed the consolidation of two branches and announced the pending consolidations of two branches to be completed by mid-2014. As of December 31, 2013, full-time equivalent employees declined to 285 as compared to 313 as of September 30, 2013, and 329 as of December 31, 2012. The associated cost savings with the reduced workforce is at least $2 million in salary and benefits annually with full realization to begin in the first quarter of 2014. Various other cost saving are anticipated to further reduce non-interest expense for 2014.

“Significant progress was made in the fourth quarter, but we recognize that we have significant work remaining to realize our full potential following the recapitalization,” said CEO Kramer. “We remain confident in our ability to build a top-tier community bank in our strong East Tennessee markets.”

About First Security Group, Inc.

First Security Group, Inc. is a bank holding company headquartered in Chattanooga, Tennessee, with $1.0 billion in assets. Founded in 1999, First Security’s community bank subsidiary, FSGBank, N.A. has 28 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia. In Dalton, Georgia, FSGBank operates under the name of Dalton Whitfield Bank; along the Interstate 40 corridor in Tennessee, FSGBank operates under the name of Jackson Bank & Trust. FSGBank provides retail and commercial banking services, trust and investment management, mortgage banking, financial planning, internet banking (www.FSGBank.com).

http://www.businesswire.com/news/home/20140225006161/en/Security-Group-Announces-2013-Earnings#.Uw13LR6YaUk

Q3 results impacted by loan-loss provisions.

First Security recorded a $1.6 million negative provision to the allowance for loan and lease losses for the quarter and a $1.8 million negative provision for the year.

First Security Group Announces Third Quarter Results (11/14/13)

New Lending Initiatives Announced

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--First Security Group, Inc. (NASDAQ: FSGI) today reported a net loss allocated to common shareholders of $1.4 million, or $0.02 per basic and diluted share, for the third quarter of 2013 as compared to a loss of $9.4 million, or $5.79 per basic and diluted share, for the same period in 2012. For the nine months ended September 30, 2013, First Security reported net income available to common shareholders of $12.0 million, or $0.30 per basic and diluted share, as compared to a $23.5 million loss, of $14.54 per basic and diluted share, for the same period in 2012.

“The third quarter represents the first full quarter after the April recapitalization,” said Michael Kramer, First Security’s President and Chief Executive Officer. “While we are pleased with our continued improvement in our deposit mix and associated cost, it is essential that we achieve significant improvement in loan and revenue growth.”

For the third quarter of 2013, net interest income improved by $679 thousand, or 12.4%, to $6.2 million compared to $5.5 million for the linked second quarter of 2013. Total interest income contributed an additional $386 thousand during the third quarter as First Security reduced cash and invested in higher yielding investment securities. Total interest expense declined by $293 thousand through reductions in the costs of deposits as well as reductions in total deposits.

During the third quarter, First Security continued to improve its deposit mix by increasing pure deposits, defined as transaction-based accounts, while reducing higher cost customer CDs as well as reducing brokered CDs as they matured with available cash. During the third quarter, average pure deposits increased by $22.4 million, or 5.2% (20.7% annualized) to $454.4 million while customer CDs and brokered CDs decreased by $61.0 million, or 11.6% (46.3% annualized). As of September 30, 2013, pure deposits totaled 50.0% of total deposits as compared to 39.6% as of September 30, 2012. The changes in deposit mix resulted in the average rate paid on customer deposits improving from 0.64% to 0.57% and the overall cost of deposits improving from 0.96% to 0.86% comparing the second and third quarters of 2013.

With continued asset quality improvement and minimal charge-offs, First Security recorded a $1.6 million negative provision to the allowance for loan and lease losses for the quarter and a $1.8 million negative provision for the year. First Security realized net recoveries of $32 thousand during the third quarter of 2013 and $1.3 million in net charge-offs for the year to date period. Nonaccrual loans declined by $1.8 million to $6.8 million as of September 30, 2013 compared to $8.6 million as of June 30, 2013. Nonperforming loans to total loans improved to 1.37% as of September 30, 2013 as compared to 1.65% as of June 30, 2013. Based on the continued improvement in asset quality and minimal charge-offs, the negative provision was appropriate to reduce the allowance to total loans from 2.27% as of June 30, 2013 to 2.00% as of September 30, 2013.

Non-interest income remained consistent quarter-over-quarter at $2.5 million. Non-interest expense decreased by $1.5 million to $11.4 million for the third quarter of 2013 as compared to the second quarter of 2013. During the third quarter, First Security announced the pending consolidations of two branches to be completed by December 31, 2013 as well as an overall 10% reduction in full-time equivalent employees. The associated cost savings with the reduced workforce is approximately $2.2 million in salary and benefits annually with full realization to begin in the first quarter of 2014. Various other cost saving are anticipated to further reduce non-expense expense for 2014.

“Over the last several quarters, we have seen significant pricing and credit concessions from the competition that has inhibited our ability to grow loans with the quality and yields that we seek,” said John Haddock, First Security’s EVP and Chief Financial Officer. “At the same time, we have been evaluating certain niche lending initiatives and have begun to implement four distinct initiatives to offset the impact of these competitive pressures.”

First Security has announced the implementation of four niche lending opportunities. First, Tri-Net Direct is a new division focused on national net lease lending and includes three full-time employees. Tri-Net will originate construction of preleased “build to suit” projects and provide interim and long term financing to professional developers and private investors for commercial real estate on long term lease to tenants that are investment grade or have investment grade attributes. Second, First Security has partnered with a third-party that originates small balance, unsecured consumer loans, primarily associated with home improvement projects. Third, First Security has built an asset-based lending unit to serve as a community bank alternative for asset-based lending within our markets that should generate above average return on a risk-adjusted basis. The fourth initiative is a dedicated team focused on originating and selling government guaranteed loans, including SBA and USDA loan products.

“Our ability to supplement the lending activities of our traditional bankers with the niche lending initiatives should significantly enhance our ability to achieve our desired loan growth while providing value added services to our customers,” said CEO Kramer. “The return to core profitability is predominantly associated with our ability to increase loans and change our mix of earning assets.”

About First Security Group, Inc.

First Security Group, Inc. is a bank holding company headquartered in Chattanooga, Tennessee, with $1.0 billion in assets. Founded in 1999, First Security’s community bank subsidiary, FSGBank, N.A. has 30 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia. In Dalton, Georgia, FSGBank operates under the name of Dalton Whitfield Bank; along the Interstate 40 corridor in Tennessee, FSGBank operates under the name of Jackson Bank & Trust. FSGBank provides retail and commercial banking services, trust and investment management, mortgage banking, financial planning, internet banking (www.FSGBank.com).

http://www.businesswire.com/news/home/20131114005654/en/Security-Group-Announces-Quarter-Results

First Security Group, Inc. Announces Over-Subscription of Rights Offering (9/25/13)

Gross Proceeds of $5.0 million to Further Strengthen Capital Position

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--First Security Group, Inc. (NASDAQ: FSGI) (the “Company” or “First Security”), the bank holding company for FSGBank, N.A. (“FSGBank”), announced today the results of the Company’s rights offering. Nearly $7.8 million of additional common stock was requested for the $5.0 million offering. Final allocations and delivery of shares are expected by the end of September.

In April 2013, the Company completed a recapitalization (the “Recapitalization”), including the restructuring of its TARP CPP preferred stock. On April 11, 2013, the Company issued approximately 9.9 million shares of the Company’s common stock to the U.S. Treasury (the “Treasury”) for full satisfaction of the Treasury’s TARP CPP investment in the Company. The Treasury immediately sold the common stock to institutional and other accredited investors previously identified by the Company at $1.50 per share. On April 12, 2013, the Company issued an additional approximately 50.8 million shares of common stock at $1.50 per share to institutional and other accredited investors. In aggregate, investors purchased 60,735,000 shares for $91.1 million.

As part of the Recapitalization, shareholders of record as of April 10, 2013 (the “Legacy Shareholders”) were provided the right to purchase two shares of Company common stock for every share owned as of the record date, as well as the opportunity to request additional shares of Company common stock, if available. The subscription price was $1.50 per share with a maximum of 3,329,234 shares of Company common stock available, or approximately $5.0 million (collectively, the “Rights Offering”).

“As the final component of the recapitalization, we are very grateful for the positive response from our legacy shareholders,” said Michael Kramer, President and Chief Executive Officer of First Security. “With requests totaling over 150% of the maximum size of the offering, we believe that this is another vote of confidence for our markets, our business plan, and our people.”

The Company anticipates downstreaming the net proceeds to FSGBank in order to further solidify FSGBank’s regulatory capital ratios and to support future balance sheet growth. The combined effects of the additional capital from the Rights Offering and the previously announced Recapitalization and completed loan sale are expected to result in an improved risk profile, enhanced profitability and compliance with most, but not all, aspects of the regulatory orders of the Company and FSGBank.

Raymond James & Associates, Inc. acted as financial advisor and dealer manager for First Security Group, Inc. in connection with the Rights Offering. Bryan Cave LLP acted as legal counsel to First Security Group, Inc in connection with the Rights Offering.

About First Security Group, Inc.

Founded in 1999, First Security’s community bank subsidiary, FSGBank, has 30 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia. In Dalton, Georgia, FSGBank operates under the name of Dalton Whitfield Bank; along the Interstate 40 corridor in Tennessee, FSGBank operates under the name of Jackson Bank & Trust. FSGBank provides retail and commercial banking services, trust and investment management, mortgage banking, financial planning and Internet banking services (www.FSGBank.com).

Note Regarding Forward Looking Statements

Some of our statements contained in this release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to future events or our future financial performance and include statements about the Company’s future growth and market position and the execution of its business plans. When we use words like “may,” “plan,” “contemplate,” “anticipate,” “believe,” “intend,” “continue,” “expect,” “project,” “predict,” “estimate,” “could,” “should,” “would,” “will,” and similar expressions, you should consider them as identifying forward-looking statements, although we may use other phrasing. These forward-looking statements involve risks and uncertainties and are based on our beliefs and assumptions, and on the information available to us at the time that these disclosures were prepared.

These forward-looking statements involve risks and uncertainties and may not be realized due to a variety of factors. There can be no assurance that the actual results, performance or achievements of the Company will not differ materially from those expressed or implied by forward-looking statements. For details on the factors that could affect expectations, see the cautionary language included under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 and the Company’s Quarterly Report on Form 10-Q for the quarters ended March 31, 2013 and June 30, 2013, and other filings with the SEC.

Many of these risks are beyond our ability to control or predict, and you are cautioned not to put undue reliance on such forward-looking statements. First Security does not intend to update or reissue any forward-looking statements contained in this release as a result of new information or other circumstances that may become known to First Security, and undertakes no obligation to provide any such updates.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this Note. Our actual results and condition may differ significantly from those we discuss in these forward-looking statements.

Contacts

First Security Group, Inc.
John R. Haddock, CFO, 423-308-2075
jhaddock@FSGBank.com

http://www.businesswire.com/news/home/20130925006354/en/Security-Group-Announces-Over-Subscription-Rights-Offering

This may be one of the last stragglers to appreciate in s/p from the TARP deal. Made a mint on FITB, and I can see the same here, in time. Slowly but surely hanging on and up. Needs a few analyst buy recos and this can see 3's imo.

~ $FSGI ~ April was bad ask here!!

Daily Par Sar Buy Signal ~ Criteria alert triggered during a recent trading session!

$FSGI has just triggered the "Parabolic SAR Buy Signals" scan criteria at Stockcharts.com
~ http://tinyurl.com/SAR-BUY ~







For a more in Depth study and DD profile, similar to the one contained in this link: ~ http://tinyurl.com/DDexample ~
Click the following link and type ticker or brief message asking me about the DD: ~ http://tinyurl.com/GET-THE-DD ~

What does the scan "Parabolic SAR Buy Signals" mean? Below is an image example and study link.
~ http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:parabolic_sar ~


To find other similar posts of "FSGI" utilize the links that follow.
Search MACDgyver's "Parabolic SAR Buy Signals" posts: ~ http://investorshub.advfn.com/boards/msgsearchbymember.aspx?searchID=251916&srchyr=2013&SearchStr=ParSarBuyScan ~
Search MACDgyver's posts for symbol "FSGI": ~ http://investorshub.advfn.com/boards/msgsearchbymember.aspx?searchID=251916&srchyr=2013&SearchStr=FSGI ~
Search Ihub for "FSGI" posts: ~ http://investorshub.advfn.com/boards/msgsearch.aspx?SearchStr=FSGI ~


For more in depth training and information visit Chartschool on the Stockcharts page.
~ http://stockcharts.com/school/doku.php?id=chart_school ~


Also don't forget the Ihub Edu Channel.
~ http://investorshub.advfn.com/boards/education.aspx ~


c

Quarterly Report (10-q)

Date : 08/15/2013 @ 6:02AM
Source : Edgar (US Regulatory)
Stock : First Security Grp., Inc. (MM) (FSGI)
Quote : $2.32 0.11 (4.98%) @ 4:02PM


Equity - $86.6MM
EPS - .39 (*compared to a -$4.82 per share Loss one year earlier)

http://ih.advfn.com/p.php?pid=nmona&article=58828562

re: TARP

First Security Group, Inc.

Chattanooga, TN
Total TARP funds owed: $33,000,000
$33,000,000 on Jan. 9, 2009

http://banktracker.investigativereportingworkshop.org/tarp/tennessee/chattanooga/first-security-group-inc/


Line item --------- March 31, 2012------- March 31, 2013

Assets-------------- $1,129,982,000 ------ $1,041,526,000

Deposits------------ $1,041,526,000 -------- $991,727,000

Loans----------------- $584,925,000 -------- $530,496,000

Loan loss provision----- $1,801,000 ------------ $678,000

Profit------------------ $-5,510,000 ---------- $-7,199,000

Capital----------------- $57,710,000 ---------- $19,932,000

Reserves--------------- $18,990,000 ---------- $13,500,000

Other real estate owned -- $24,716,000 --- $12,706,000

Capital plus reserves ----- $76,700,000 ----- $33,432,000

Total troubled assets ------ $71,553,000 ---- $24,169,000

http://banktracker.investigativereportingworkshop.org/banks/tennessee/chattanooga/fsgbank-national-association/

*The bank is still losing money as of the 1st qtr however they've really knocked down their OREO & NPA's.

Thanks for your PM 56,but sorry unable to reply back by PM(don't have that priveleged feature as I'm a Freebie here).These days I'm not much of a longterm buy & hold type,lately become more of a swing trader.I got out of FSGI for a neat little gain,it was getting too slow,still like it and have on my watchlist though.
Thanks for your message,much appreciated,will follow your posts for banking sector play ideas.Good luck.

~ $FSGI ~ Daily Par Sar Buy Signal ~ Criteria alert triggered during a recent trading session!

$FSGI has just triggered the "Parabolic SAR Buy Signals" scan criteria at Stockcharts.com
~ http://tinyurl.com/SAR-BUY ~







For a more in Depth study and DD profile, similar to the one contained in this link: ~ http://tinyurl.com/DDexample ~
Click the following link and type ticker or brief message asking me about the DD: ~ http://tinyurl.com/GET-THE-DD ~

What does the scan "Parabolic SAR Buy Signals" mean? Below is an image example and study link.
~ http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:parabolic_sar ~


To find other similar posts of "FSGI" utilize the links that follow.
Search MACDgyver's "Parabolic SAR Buy Signals" posts: ~ http://investorshub.advfn.com/boards/msgsearchbymember.aspx?searchID=251916&srchyr=2013&SearchStr=ParSarBuyScan ~
Search MACDgyver's posts for symbol "FSGI": ~ http://investorshub.advfn.com/boards/msgsearchbymember.aspx?searchID=251916&srchyr=2013&SearchStr=FSGI ~
Search Ihub for "FSGI" posts: ~ http://investorshub.advfn.com/boards/msgsearch.aspx?SearchStr=FSGI ~


For more in depth training and information visit Chartschool on the Stockcharts page.
~ http://stockcharts.com/school/doku.php?id=chart_school ~


Also don't forget the Ihub Edu Channel.
~ http://investorshub.advfn.com/boards/education.aspx ~


c

FSGI not a single share traded today,it's past noon,is that possible/likely?Any thoughts please?

Today's huge volume(5X the avg volume)feels like this is going to finally make a move past the $2-2.05 range that it has been stuck in since the price drop on June 7.Any thoughts on today's volume?

Despite having one of the top ophthalmologists in Dallas prescribing my glasses, I still have trouble seeing my crystal ball clearly.

Seriously, I believe that patient, long-term minded investors will be rewarded handsomely.

Thanks. I couldn't agree more, but thought I'd check just in case I was missing something.

I don't consider this a "prediction" ok but in my mind dilution and gravity have allot in common...especially in the short run...and until the story changes that's where my head is at on this.

Good Luck!

Do you think the price will bounce up anytime in the next month, or do you see a slow bleed from here? I read your previous post. I'm just curious as to your thoughts on what may happen in the next month or two. TIA

Actually have followed both of their careers for about 25 years.

Ford is a master banker. Price is a master investor.

There is only difference - Ford is in a control position.

Expect similar results.

I have post-recap BV at $1.79. How in the world did it get up to $6+? We saw a very simular thing happen after Mr. Gerald Ford infused $500MM into PCBC in May of 2010.

To recap: Mr. Ford bought 91% of the company for .20 @ share... and that should have set the bar for retailers but in all the excitement to get in on the deal retailers took the pps to $1.68 (or 8x what Mr. Ford paid). Other contributing factors were - short covering, chart readers and buzz traders.

EI could confirm this but I wouldn't put billionaire Michael Price in the same league as billionaire Gerald Ford when it comes to bank dealings ...but both men do have their followers. In the PCBC case retailers paid up to 7x what Mr. Ford paid. In the FSGI case retailers paid up to 4.5X what Mr price paid.

I fully expect FSGI to drift down in pps now just as PCBC did...but after that the comparison to PCBC and Mr. Ford end!

*So did Mr. Ford create some billionaire envy among his peers? lol..I wouldn't be surprised. I think Price saw what Ford did when he turned $500MM into $1.5 Billion in a little less than 2 years! Not a bad ROI!

http://www.businessweek.com/stories/2010-05-05/a-new-banking-bet-for-billionaire-gerald-ford

http://investorshub.advfn.com/boards/read_msg.aspx?message_id=73213658

Thank you both,El and chevy,for your thoughts on the banks as well as FSGI specifically,very much appreciated.

As my good friend and partner EI pointed out we're "often confused why it takes so long for the Mr. Market to catch up with something close to reality".


We've spent the last couple years scouring literally hundreds of small banks across the country looking for opportunities and there simply is no rhythm or reason to price vs fundamental value.

It's fair to say that most small banks in the country post recession are in a similar phase of recovery. But before that most of them experienced a 90% (or more) drop in market value since 2007/8.

I think it's also fair to say that small banks weren't known in the past to be a traders stock. They were something only investors tended to buy. Historically, as EI can attest, bank stocks aren't known for big moves...maybe 2% a year...which is boring stuff for a "trader".

Now suddenly with market values so low and all these small obscure banks making a recovering, traders have discovered these banks and stepped into the void with absolutely no regard to a banks' fundamentals. I'm not being judgmental when I say this but if you ask them they'll say they bought in because it was "cheap".

It's impossible to predict which bank they will descend on or where they'll take it. So long story short...I have no idea where this will go.

Over time I like banks that are currently selling for under book value with robust earnings. There are a few out there ...and over time I think prove to be the better buy.

Trading or Investing...Good luck!
Chevy

Added few more,avg now 2.03,fingers crossed.Will try not to look tick by tick,lol!Good luck

Do you think those new investors will sell so soon,at such low price?I somehow am unable to understand the huge price drop just because they are allowed to sell.I don't believe they will though.But what do I know,lol!
Edit: just saw your next msg saying you also don't believe they would sell,thanks.

Validation.

The strange thing is despite the filing of the Form S-1, none of the investors are likely to sell anytime soon.

Some investors live in a vacuum.

I hate to say this, but 56Chevy and I are often confused why it takes so long for the Mr. Market to catch up with something close to reality.

FSGI has the potential to fall further.

Not much more, however.

Please note that the investors paid $1.50 per share.

Hi chevy..do you think FSGI is now priced fairly after this huge drop last friday to low 2's? Your new thoughts on this please.Thanks

I just got a starter in premarket @2.14.I'm trying to find the reason why it spiked up to 6+ too though!

So a quick look shows it trading above BV even after the big price decline. I have post-recap BV at $1.79. How in the world did it get up to $6+?

Well I just started looking at this after I saw the 55% drop. Came to the board to catch up on what led us to here, and lo and behold, there's Chevy and EI! Should have known you guys are already all over this!

DBEN in at $ 2.04

*PPS as of 5/1/2013 $3.68. Needs to go lower. Hard to ignore a near double in less than 2 weeks....pps as of 5/13/2013 $6.24

First Security Grp., Inc. (FSGI)
$ 6.24 up 0.351 (5.96%)
Volume: 90,485

*Investors are paying over 4 X what MFP Partners, L.P. paid for shares. If we use PCBC as an example this strategy in the short run works for risky trading but for long term investing it's a bad move.

Price Bio:

http://www.ou.edu/price/left/about_price/michael_price.html

First Security Group Inc (FSGI): Billionaire Michael Price Just Reported a Massive Stake

Published: April 15, 2013 at 12:14 pm

In the hedge fund world, Michael Price's MFP Investors reported a buy of 6,080,000 shares of First Security Group Inc (NASDAQ:FSGI) in a 13D filing with the SEC's Edgar system. Altogether, the holding in First Security Group is now worth close to $15,321,600. This is a new position, and was likely a piece of the company's strategic recapitalization last week.

Looking at the entire picture, 13Ds reveal the goals of activist hedge fund managers. These talented managers are the most widely covered in the investment space, and look to impose their will to an already standing company.

In layman's terms, it's extremely important for retail investors to pay attention to Michael Price's (MP) new investment into First Security Group Inc (NASDAQ:FSGI).

[....]

http://www.insidermonkey.com/blog/first-security-group-inc-fsgi-billionaire-michael-price-just-reported-a-massive-stake-117712/?singlepage=1

*MP's buy-in price? $1.50...how do we know?

Stock Purchase Agreement

On February 25, 2013, the Company entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with certain institutional investors, including affiliates of EJF Capital LLC (“EJF”), GF Financial II, LLC (“GF Financial”), MFP Partners, L.P. (“MFP”) and Ulysses Partners, L.P. (“Ulysses”) (collectively, the “Investors”), whereby EJF, GF Financial, MFP and Ulysses each agreed to purchase approximately $9.0 million of common stock at the Purchase Price. In aggregate, Investors agreed to purchase approximately $91.1 million of common stock at $1.50 per share. The Stock Purchase Agreement provided that the Company could direct each Investor to purchase all or part of such Investor's committed investment from Treasury. Investors purchased shares remaining from their committed investment directly from the Company. Accordingly, on April 12, 2013, the Company sold 50,793,092 shares of common stock to the Investors.

Subscription Agreements

Other accredited investors (the “Local Investors”) executed subscription agreements (“Subscription Agreements”), pursuant to which they committed to purchase shares of common stock for the Purchase Price. The Subscription Agreements provided that the Company could direct each Local Investor to purchase all or a portion of such Local Investor's committed investment from Treasury.

Gross-Up Rights

The Stock Purchase Agreement provides that each Investor acquiring 5.0% or more of the Company's outstanding common stock will hold gross-up rights by which they may purchase sufficient securities as to maintain their ownership percentage of the Company. Any offering of securities by the Company that is not contemplated by the Stock Purchase Agreement will trigger these rights, and any purchase of securities by such Investors will be on the same or similar terms as those offered to other investors. The gross-up rights terminate with respect to each Investor once such Investor no longer owns 5.0% or more of the Company's outstanding common stock.

Changes to the Board of Directors

The Stock Purchase Agreement provides that, prior to closing, MFP and Ulysses would each designate an individual to serve as a director of the Company, each subject to regulatory non-objection. As a result, the Board of 5 Directors will be increase in size by two directors. The Company has agreed to nominate the designated directors so long as the respective institutions retain ownership of at least 50% of their acquired shares.

The Stock Purchase Agreement also provides that each Investor that beneficially owns at least 5.0% of the Company's outstanding common stock may designate an individual to attend meetings of the Board of Directors as a non-voting observer (the “Observer”). The right of each Investor to appoint an Observer terminates once such Investor no longer owns 5.0% or more of the Company's outstanding common stock.

The foregoing summary of the documents relating to the Recapitalization are not complete and are qualified in their entirely by reference to the full text of such documents, copies of which are included as exhibits to the Company’s Current Report on Form 8-K filed on February 26, 2013 and incorporated by reference herein. See “Where You Can Find More Information” and “Incorporation of Certain Information by Reference.”

http://www.faqs.org/sec-filings/130425/FIRST-SECURITY-GROUP-INC-TN_S-1/

*PPS as of 5/1/2013 $3.68. Needs to go lower.

Thanks. Between that and recent insider buying, I can understand. Had just put this one on my list to investigate over the weekend. LOL. Day late and dollar short!

http://ih.advfn.com/p.php?pid=nmona&article=57144570

WTF happened here this afternoon? This bank has a negative book value of -$1.94 and a troubled asset ratio of 95.10 !!!!

Michael Kramer Named CEO of FSGBank

Financial services veteran Michael Kramer has been named chief executive officer of FSGBank, N.A., a $1.1 billion bank headquartered in Chattanooga, Tennessee with 31 full-service offices in eastern and middle Tennessee and northern Georgia. FSGBank is the community bank subsidiary of First Security Group, Inc. (NASDAQ: FSGI).

http://ih.advfn.com/p.php?pid=nmona&article=50317363

after hours @4.15...will do a CARV..expect to see it jump again.

This explains the change in pps in Sept. & Oct.

NOTE 9 – STOCKHOLDERS’ EQUITY

Common Stock

On April 4, 2011, the Company received a notice from the NASDAQ Stock Market (“Nasdaq”) that its stock had closed below $1.00 per share for 30 consecutive business days, and was therefore not in compliance with Nasdaq Marketplace Rule 5450(a)(1) (the “Bid Price Rule”). In accordance with Marketplace Rule 5810(c)(3)(A), the Company may regain compliance with the Bid Price Rule if its stock closes at or above $1.00 for 10 consecutive business days by October 3, 2011. The notification has no effect on the listing of the Company’s stock at this time. The Company filed a Current Report on Form 8-K on April 8, 2011 that provides additional information.

On September 13, 2011, shareholders approved at the Company’s annual meeting a proposal to amend the Company’s Articles of Incorporation that effected a one-for-ten (1-for-10) reverse stock split of the Company’s common stock. The reverse stock split was effective at the opening of business on September 19, 2011. Any fractional shares resulting from the reverse stock split were eliminated by rounding up to the next whole share. The Company issued 495 additional common shares as a result of eliminating fractional shares. The number of authorized shares of common stock following the reverse stock split remained at 150,000,000 shares. All prior periods have been restated to give retroactive effect to the one-for-ten reverse stock split that took effect on September 19, 2011.

http://ih.advfn.com/p.php?pid=nmona&article=49943446