Bank suspends dividend

Two locally based banks took separate measures Thursday to bolster their balance sheets.

The Bank of South Carolina Corp. temporarily suspended its third-quarter cash dividend, saying it will put the money toward its loan-loss reserves, while First Federal of Charleston's owner bumped up the amount it is seeking to raise in a sale of its common stock.

Bank of South Carolina said it expects to reinstate its cash payout in the fourth quarter. The community bank had been distributing shareholders a quarterly dividend of 16 cents per share.

"After a long-term evaluation of our significant loan and deposit growth, the economy, and listening to regulator expectations, we decided that additional funding to the provision for loan losses is the proper strategy in today's environment," said Hugh C. Lane, Jr., president and chief executive. "This action is voluntary, and will further strengthen the position of the company today and into the future."

Lane said the onetime measure will conserve about $700,000 in cash.

The Bank of South Carolina's stock was unchanged Thursday at $13.55.

Separately, Charleston-based First Financial Holdings Inc. said Thursday it would seek to raise more than $60 million by selling stock, or about $10 million more than the company announced Monday.

The bank owner tweaked the deal by offering about 4.2 million shares at $15.50 each. Net proceeds were estimated at $60.6 million.

First Financial said the infusion of capital would help support the growth of its businesses and fund possible acquisitions of lenders taken over by the Federal Deposit Insurance Corp.

The money also could position the company to buy back some of the preferred stock it issued last year to the U.S. Treasury under the Troubled Asset Relief Program, or TARP.

Dee Bee Wright, vice president of investor relations, said the higher dollar figure matches the TARP funds First Financial received. That, in turn, allows the company to cut by half the number of warrants it must offer the government under the program. Warrants are essentially rights to buy common stock at a predetermined price.

"That advantage led us to seek the higher amount," Wright said.

Wright said demand for the offering has been robust, allowing First Financial to raise more than it originally planned.

"We're really pleased with the response and the confidence that institutional and retail shareholders are showing in our company," she said.

First Financial's shares fell 68 cents Thursday, or 4.2 percent, to close at $15.62.