The Securities and Exchange Commission is looking into Capitol Bancorp Ltd.'s past reporting of results.
The $3.5 billion-asset company, with headquarters in Phoenix and Lansing, Mich., said its annual report that it was notified on March 30 that it would receive a subpoena from the SEC's Chicago office concerning its third-quarter reporting. Capitol amended and restated those results early last month to reflect an additional $11.7 million loan-loss provision. The annual report was filed Thursday.
"Capitol understands that the issuance of subpoenas by the [SEC], in itself, does not mean that the SEC has concluded that Capitol has broken the law or that the SEC has a negative opinion of Capitol," the filing said. "Capitol is fully complying with the SEC's requests, and looks forward to a timely resolution."
Capitol said it also received a subpoena from the SEC in November 2010 regarding its methodology for recording the allowance for loan losses before March 31, 2009.
Capitol also said Thursday that it has sold its interest in the $35 million-asset Bank of Fort Bend in Sugar Land, Texas.
Capitol said in its filing that it has eight pending bank sales and completed 11 sales in 2010. Still, it is not enough to cure the company's capital woes.
"It is unlikely that these transactions may result in a return to profitability or permit Capitol to reach its regulatory capital targets," the filing said.
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