Here’s a lesson on how to achieve financial health in this environment:
- Hartford Financial (HIG) is spending $10 million to buy Federal Trust Bank, a piddly little institution based in Sanford, FL.
- By acquiring the bank and applying with the Office of Thrift Supervision to become a Savings & Loan (yes, Hartford Financial is applying to be an S&L!), the insurance company can access the Treasury’s Capital Purchase Program (CPP).
- The firm believes based on current guidelines that they’ll be eligible for a capital purchase of $1.1 billion to $3.4 billion.
- On the news, shares of Hartford are up about 30%.
It’s that simple.
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