Bank establishes holding company

First Bank of Oconomowoc has approved the creation of a one-bank holding company called Oconomowoc Bancshares to increase shareholder liquidity and assure continued local ownership of the bank, according to documents filed with the State Office of the Commissioner of Securities.

The new holding company would acquire at least 80% of the outstanding stock in the state-chartered bank, which has been a fixture in Oconomowoc since 1859. The shares are not publicly traded.

The proposed tax-free exchange is available only to shareholders in Wisconsin, according to the prospectus. The new holding company will buy back stock from out-of-state shareholders and sell it to local investors or retire it.

First Bank of Oconomowoc now has 309 Wisconsin shareholders. They own 17,542 of the bank's 20,000 outstanding shares, according to the filing.

The bank has capitalization of $10.2 million, according to financial data filed with the commissioner. Its assets total $115 million, compared to $89 million two years ago. Financial statements that accompanied the filing indicate the bank's return on shareholder equity is 16.06% and its return on assets is 1.45%.

"That's excellent," said John E. Rickmeier, president of IDC Financial Publishing, an independent financial publisher in Hartland.

Rickmeier said very few banks in the state have a higher rating.

According to the prospectus, "the bank currently has no plans to expand its operations through acquisitions." But if banks are allowed to expand into other financial activities, as has been proposed in Congress, the holding company could provide an umbrella over more diverse businesses.

The bank's board is chaired by James F. Dowd, 63, who has been a director since 1974. Malcolm A. Dorn, 47, has been president and director since 1992. Previously, he was a vice president of Ixonia State Bank in Ixonia.

Copyright 1995
Provided by ProQuest Information and Learning Company. All rights Reserved.