HARTFORD, Conn. (AP) — Hartford Financial Services Group Inc. said on Monday that it will sell Federal Trust Corp., a thrift holding company with 11 offices in Florida, to CenterState Banks Inc.
Financial terms of the transaction were not disclosed.
Hartford expects to record an after-tax charge of about $70 million in the second quarter related to the transaction. That includes losses on certain assets and liabilities that will not be sold to CenterState.
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Hartford, an insurance and wealth management company, said the transaction was in line with other recent sales of units that are not part of its main lines of business.
Hartford acquired Federal Trust for $10 million in 2009. When the transaction was announced in November 2008 during the financial crisis, Hartford said the deal would fulfill a key requirement needed to participate in a Treasury Department bailout program. To qualify, Hartford also applied to switch its business structure to a savings and loan holding company. Hartford received $3.4 billion in funds in late June 2009, and paid back the government in March 2010.
Federal Trust is the holding company for Federal Trust Bank, a federally-chartered, FDIC-insured savings bank that operates offices in Florida's Seminole, Orange, Volusia, Lake and Flagler counties. Its sale to CenterState is expected to be completed in this year's fourth quarter, subject to regulatory approval.
CenterState is based in Davenport, Fla., with about $2.2 billion in assets. The company operates through two subsidiary banks with 52 branches in 14 central Florida counties.
Shares of Hartford fell 52 cents to $26.57 in afternoon trading. CenterState shares rose 39 cents, or 6.7 percent, to $6.18.
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