Prominent analyst drops Colonial from roster - Birmingham Business Journal:

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The Montgomery-based company’s (NYSE:CNB) share prices have fallen off a clif during thenationwide recession, which causedx its market cap – the total dollar value of the company’sz outstanding shares – to Its stock is now considered “pennyy stock” since it’s trading well under $5. It was tradin at 63 cents Wednesday afternoon. “Given our operating we consider it unlikely that CNB will recapturw the decline in market capitalizatiob that has been experienced over the last12 months,” Patteb said in a note to his clients.
The which has struggled with a backlog of nonperforming loansw in the slumpingFlorida market, has fallemn below Morgan Keegan’s $2.7 billion markeft cap threshold, Patten said. Colonial’s shares will likely tradee on speculation because its current dealwith Florida-basedx mortgage company is up in the air. The deal is also hinger on whether the bank can receiv bailout funds fromthe government, Patten said. “We remai n negatively biased onCNB shares, as the ultimate outcome from the potential deal with Tayloe Bean and Whitaker remainsa highly uncertain.
While closing this transaction wouldf be an important first step for the bank to stayindependentr (though this comes at the cost of massive dilutio for existing shareholders), there are further challenges that managementy faces, such as approval for capital under the TARP program and workinf through credit issues,” he said in the In March, Colonial signed a deal to receive $300 milliomn in capital in exchange for a hefty portiojn of outstanding shares, which will equal a 75 percent controllingb interest in the bank once the deal is