BusIness GuIde

Solid Financial Institutions, PublicFinance Spur Economic DevelopmentCentral Arkansas Financial Institutions — Third Quarter 2008Dollar numbers in thousandsArkansas Locations Assets DepositsAllied Bank – Mulberry $139,896 $112,186Arvest Bank – Fayetteville $9,821,016 $8,080,034Bank of England – England $173,584 $132,075Bank of Little Rock – Little Rock $146,865 $127,704Bank of the Ozarks – Little Rock $3,057,523 $2,310,179The Capital Bank – Little Rock $209,881 $149,881Centennial Bank – Little Rock $265,529 $186,456Community Bank – Cabot $432,584 $297,226Delta Trust & Bank – Parkdale $236,220 $213,224Eagle Bank and Trust – Little Rock $127,731 $99,287First Arkansas Bank and Trust – Jacksonville $520,940 $405,038First National Bank – Hot Springs $695,253 $526,491First Security Bank – Searcy $1,890,353 $1,526,355First Service Bank – Greenbrier $212,367 $185,897First State Bank – Conway $641,318 $473,330First State Bank – Lonoke $327,114 $268,008Home Bank of Arkansas – Portland $68,870 $61,479Malvern National Bank – Malvern $381,081 $310,406Metropolitan National Bank – Little Rock $1,664,542 $1,249,146National Bank of Arkansas – North Little Rock $207,104 $148,184One Bank & Trust – Little Rock $408,762 $322,437Pine Bluff National Bank – Pine Bluff $353,880 $291,277Pulaski Bank and Trust – Little Rock $1,572,019 $1,219,227Simmons First National Bank – Pine Bluff $1,371,576 $1,093,963Simmons First Bank of Hot Springs – Hot Springs $173,497 $124,615Summit Bank – Arkadelphia $1,014,255 $692,352Twin City Bank – North Little Rock $746,581 $550,773The Union Bank of Benton – Benton $237,525 $186,397Dollar figures in thousands Assets DepositsBancorpSouth – Tupelo, MS $13,293,708 $9,633,860Bank of America – Charlotte , NC $1,359,070,851 $846,230,545Regions Bank – Birmingham , AL $139,556,254 $90,632,240U.S. Bank – Cincinnati , OH $242,596,810 $147,640,677Source: FDIC.gov, Institution Directory, Assets & Liabilities, Sept. 30, 2008BANKING & FINANCETax-Exempt Industrial DevelopmentBonds (IDBs)Tax-exempt IDBs are debt obligations of state and localgovernments that are sold on the national capital markets,the proceeds of which are loaned or leased to qualifiedcompanies. IDBs have been available in Arkansas for morethan 40 years. Interest income from these securities is exemptfrom federal taxes, as well as state taxes if purchasedby Arkansas residents. This exemption allows borrowers topay a lower interest rate on the debt used to finance capitalimprovements, thereby reducing borrowing costs. To qualifyfor tax-exempt status, issuers must meet the followingqualifications:• At least 95 percent of the issue must be used for the exemptpurpose of the borrowing.• The acquisition of land is limited to 25 percent of the issue.• For an existing building, at least 15 percent of proceedsmust be spent on renovations.• For used equipment, an amount equal to 100 percent of thepurchase price must be spent on renovation.• The average maturity of the bonds must not exceed 120percent of the expected economic life of the facility.• Capital expenditures for the three years preceding thebond issue and three years following must not exceed$20 million, and the bond issue size cannot exceed $10million per year.• Borrowers may not have more than $40 million in bondsoutstanding.Taxable Industrial Development BondsIf a borrower does not meet the above qualifications for atax-exempt issue, taxable IDBs may be issued. TaxableIDBs are similar to tax-exempt IDBs, but interest incomeon these bonds is taxable at the federal level. If purchasedby Arkansas residents, state taxes remain exempt. Taxableissues are often privately placed with an institutional investorand have lower up-front costs.Arkansas Development Finance AuthorityThe Arkansas Development Finance Authority (ADFA) wascreated in 1985 by Act 1062 as passed by the ArkansasLegislature. ADFA is the primary bond issuer for the stateand offers several programs that assist with the bond financingand other sources of financing for new and existingbusiness entities.Industrial Development Bond GuarantyProgramsThe Arkansas Economic Development Commission(AEDC) and the ADFA both offer IDB Guaranty Programsthat provide credit enhancement for the issuanceof taxable and tax-exempt bonds. Through the programs,borrowers are able to secure lower interest rates becausebond issues are backed by ADFA and AEDC’s Bond GuarantyReserve Funds. The Reserve Funds serve as the firstsource of repayment if the borrower is unable to fulfill obligationsunder the contract. lLittle Rock Regional Chamber of Commerce 2009 Business Guide 49BUSINESS DEVELOPMENT