American Security Corp., Washington's second-largest bank holding company, announced plans yesterday to nearly triple the number of shares of its stock so it will be able to make acquisitions.
The company's board said it will ask shareholders early next year to approve a 2-for-1 stock split and to increase the total number of shares of common stock from 5.25 million to 15 million.
American Security now has about 3.6 million shares of common stock outstanding. The 2-for-1 split would boost the number of shares in circulation to 7.2 million, leaving 7.8 million that could be issued later.
Chairman W. Jarvis Moody said authorizing more stock "will provide the flexibility necessary to pursue future interests of the corporation. It will, for example, position us to act in a timely fashion if sound opportunities for expansion or acquisition present themselves."
"We feel that the increase in authorized shares, above and beyond what is needed for the stock split, is very important to the corporation in light of today's ever-changing banking industry," added Moody.
Like many other industries, the banking business is moving slowly toward deregulation. It is expected that federal restrictions will be lifted within the next few years, thus permitting banks to expand across state lines and to move into nonbanking businesses.
Stockholders will be asked at American Security's annual meeting on April 20 to vote to approve the split and authorize the issuance of additional stock.