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Customized Solutions in Action for Private Banking Clients
Our investment management experience combined with our specialized Private Banking services allows us to craft financial solutions for unique situations. View some of the solutions we have recently provided our Private Banking clients.
Give us your challenging situations. Our Private Bankers will ask questions, listen to your situation and provide customized financial solutions for your unique situation. Click here if you would like a Private Banker to contact you.
| Converting Assets to Cash |
Situation: A prominent businessman sold his company to a Fortune 500 corporation. As a result, he became a senior executive with the parent company. He had received a note payable from the corporation as part of the sales agreement. The terms of the note called for the principal to be repaid in a single payment three years in the future. But the executive wanted to convert this note to cash in order to invest the proceeds in other projects.
Solution: Commerce's Private Banking Division provided financing in an amount equal to 90% of the principal balance of the note, enabling him to capitalize on these new opportunities. |
| Restricted Stock | Situation: The compensation package for local executives of a large multi-national firm included issuance of restricted common stock. The executives did not wish to divest themselves of the securities due to the favorable potential of the firm, but many of the executives wanted the equities to enhance their lifestyles or make investments. Converting restricted securities to cash, however, can be difficult due to the lack of a ready market.
Solution: With Commerce's unique experience in this area, we were able to broker an agreement with the corporation on a stock buyback, which allowed the securities to be margined, thereby providing the liquidity to the owner and the necessary collateral to the bank. These loans were made at a predetermined rate and were pre-approved, giving the utmost convenience to the clients. |
| Vacation Property | Situation: A client recently expressed interest in purchasing a home in Naples, Florida. He wanted to finance as much of the purchase price as possible.
Solution: Commerce Trust Company was happy to accommodate him with the mortgage financing. In addition, Private Banking pointed out that, if the mortgage were placed against the home in Florida, there would be a stamp tax associated with the filing. We advised him to place a home equity line of credit on his residence (in another state) in an amount adequate to finance the full purchase price. The client could then pay for his home in Florida, reap the benefit of being able to deduct the interest, not be subject to the stamp tax and have a 10-year, interest only obligation. |
| Investment Financing | Situation: A retired businessman intended to invest $3,000,000 in a business with locations in Orlando and Las Vegas. He planned to divest himself of certain securities in order to make the investment. The sale of these securities would trigger a capital gains tax liability. Solution: We approached him with the idea of using the securities as collateral for a loan. This allowed him to avoid the tax liability, continue to realize dividends and appreciation on his securities, and to deduct a certain portion of the interest on the investment. |
| Executive Relocation | Situation: A company recruited a new CEO from Canada. In addition to needing a full array of banking services, the executive needed to have issues surrounding relocation resolved for him and his spouse. These included tax implications of transferring assets from Canada to the U.S., purchasing a home in a foreign country and the benefits of leaving assets invested in Canada versus a mortgage loan.
Solution: Commerce Trust was able to make suitable arrangements for this international client to accomodate the executive's relocation. |
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