UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K/A
Amendment
No. 1
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of report (Date of earliest event
reported)
: January 14, 2010
Sterling
Banks, Inc.
(Exact
Name of Registrant as Specified in Charter)
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New
Jersey
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333-133649
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20-4647587
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(State
or Other Jurisdiction of
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(Commission
File
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(I.R.S.
Employer
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Incorporation)
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Number
)
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Identification
No.)
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3100
Route 38
Mount
Laurel, New Jersey 08054
(Address
of Principal Executive Offices and Zip Code)
Registrant's
telephone number, including area code: (856) 273-5900
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[ ] Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
[ ] Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Explanatory
Note
The
Company is filing this Amendment No. 1 to its Current Report on Form 8-K,
originally filed with the Securities and Exchange Commission (the “SEC”) on
January 21, 2010 (the “Original Filing”), to supplement and enhance its
disclosure in the Original Filing surrounding its determination that the
Company’s consolidated financial statements as of and for the three and six
months ended June 30, 2009, and for the three and nine months ended September
30, 2009, should not be relied upon. This amendment is intended to
update and supersede the Original Filing.
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Item
2.02.
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Results
of Operations and Financial
Condition.
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On
January 21, 2010, Sterling Banks, Inc. (the “Company”) issued a press release
announcing its intention to restate its results of operations and financial
condition for the three months and six months ended June 30, 2009, and the
three months and nine months ended September 30, 2009. In
connection with the enhanced disclosure to the Original Filing, the Company is
filing this Form 8-K/A to furnish a revised press release. This
information represents a change from the results of operations and financial
condition previously announced in the Company’s press release of August 19, 2009
(which was furnished as Exhibit 99.1 to the Company’s 8-K filed August
20, 2009), and November 25, 2009 (which was furnished as Exhibit 99.1 to
the Company’s 8-K filed November 25, 2009). A copy of the press
release is attached as Exhibit 99.1 to this Current Report.
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Item
4.02.
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Non-Reliance
on Previously Issued Financial Statements or a Related Audit Report or
Completed Interim Review.
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(a) Based
on the findings of a regulatory examination of the Company’s wholly owned
subsidiary, Sterling Bank (the “Bank”), the Company has amended its call reports
for the quarters ended June 30, 2009, and September 30,
2009. The Company will make certain adjustments required in
connection with the completion of the examination of the Bank by the Federal
Reserve Bank of Philadelphia (the “FRB”), for which the report was provided to
the Company in late 2009. As a result of such findings, the Board of
Directors of the Company determined on January 14, 2010, that the Company’s
consolidated financial statements as of and for the three and six months ended
June 30, 2009, and the three and nine months ended September 30, 2009,
should no longer be relied upon, and also determined to amend the Company’s
Quarterly Report on Form 10-Q for the period ended June 30, 2009 (as
originally filed on August 19, 2009) (the “Second Quarter Filing”) and the
period ended September 30, 2009 (as originally filed on November 25, 2009)
(the “Third Quarter Filing”), and to restate such consolidated financial
statements. The Company has discussed these matters with its
independent registered public accounting firm.
The FRB
examination commenced on July 27, 2009, and concluded with the issuance of a
formal written report dated November 30, 2009, using financial data as of June
30, 2009. This regulatory examination was on-going at the time the
Second Quarter Filing was filed with the SEC, and these issues were raised and
disclosed in the Third Quarter Filing with the SEC. At the
conclusion of the on-site work by the FRB examiners and prior to the Third
Quarter Filing, the FRB examination personnel orally advised the Company and its
independent auditors that, based on trends in asset quality, credit losses and
other metrics, in comparison to various national and custom peer groups with
comparable characteristics, the Bank’s allowance for loan losses should be
increased by $5 million. Subsequent to the Third Quarter Filing, the
Company received confirmation through receipt of a written examination
report. In the intervening period, the Company had on-going
discussions with the FRB to further clarify the facts and to formulate an
appropriate response to the report. As a result of the FRB
examination, the Company is required to increase its allowance for loan losses
by $5 million as of June 30, 2009. Additionally, as a result of the
foregoing, the Company determined that a valuation allowance for deferred tax
assets needed to be established in the amount of $5.6 million.
The
allowance for loan losses and provision for loan losses were increased from
amounts previously reported to reflect adjustments of the qualitative factors in
the allowance general reserves and impairment amounts within the allowance
specific reserves that the Company’s wholly owned subsidiary, Sterling Bank,
utilized in calculating the allowance for loan losses as of June 30, 2009. The
adjustment in qualitative factors reflected second quarter adverse trends in
delinquent, classified and non-performing loans in the Bank’s portfolio, which
were raised as part of the Bank’s regulatory examinations by the
FRB. The adjustment also reflected an additional qualitative factor
in certain loan segments for the newly developed and applied stress testing
procedure of collateral for commercial and residential real estate and an
increase in most loan segments for changes in national and local economic trends
and conditions. The adjustment in impairment amounts (within the
allowance specific reserves) reflect management’s re-analysis of the collateral
underlying loans analyzed for specific reserves. The valuation
allowance for loans analyzed for specific reserves has increased from the
Company’s Second Quarter Filing and Third Quarter Filing as a result of more
conservative collateral and cash flow analysis on certain loans affected by the
current economic condition.
The
Company notes that as of the date of this Current Report that management, with
the assistance of outside advisors, is continuing its analysis with respect to
any other potential additional adjustments that may be necessary or appropriate
and intends to file an amendment to each of the Second Quarter Filing and the
Third Quarter Filing on or before March 8, 2010 to reflect these
changes.
The
information in this Item 4.02 and the accompanying Exhibit 99.1 shall not be
deemed to be “filed” for purposes of Section 18 of the Securities and Exchange
Act of 1934, as amended, or otherwise subject to the liabilities of that section
or Sections 11 and 12(a)(2) of the Securities Act of 1933, as
amended. The information contained in this Item 4.02 and in the
accompanying Exhibit 99.1 shall not be incorporated by reference into any
offering circular, report or other document filed with the Securities and
Exchange Commission by the Company, whether made before or after the date
hereof, regardless of any general incorporation language in such filing, except
as shall be expressly set forth by specific reference in any such
filing.
Item
9.01.
Financial Statements and
Exhibits
.
(d)
Exhibits
.
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Exhibit Number
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Description
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99.1
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
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STERLING
BANKS, INC.
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Date: February
25, 2010
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By:
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/s/ Robert H.
King
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Name:
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Robert
H. King
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Title:
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President
and Chief Executive Officer
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EXHIBIT
INDEX
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Exhibit Number
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Description
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99.1
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