news-record.com

Q: Why do some banks take federal bailout money?

A: Because they can.

But High Point Bank executives said Monday they refused the government's $20 million offer because their solid capital position was more than enough to keep the bank healthy on its own.

"We had sufficient capital and liquidity to withstand problems that may be coming in the future, so we elected not to take the money," said Tom Eller, High Point Bank's chief financial officer.

About 15 percent of High Point Bank's assets are reserved for "risk-based capital," which is 50 percent higher than the minimum 10 percent required. It is also higher than the amount at many local community banks.

Eller said the bank applied for the money from the Troubled Assets Relief Program in December as a precaution should its balance sheet worsen.

But its consistent $785 million asset base and capital ratio didn't change, Eller said, so the money, in the end, wasn't needed.

Other community banks that have decided to take TARP money stress that they are healthy as well, but are taking the money because they believe it will strengthen their banks.

Those banks include:

* NewBridge Bancorp. It got $52 million in TARP funds. It has $2 billion in assets.

* Carolina Bank Holdings, which was approved for $16 million. It has $600 million in assets.

* Oak Ridge Financial Services Inc., which received $7.7 million. It has $310 million in assets.

High Point Bank Corp. is the holding company for High Point Bank And Trust Co. that was founded in 1905.

The bank has nine offices in Greensboro, High Point, Jamestown and Kernersville.

The bank also has one of the five largest property and casualty insurance agencies in the Triad through its Argus Insurance subsidiary.

Contact Richard M. Barron at 373-7371 or richard.barron@news-record.com