First Place gives U.S. discount on shares

STAFF REPORT

WARREN — Shareholders of First Place Financial Corp. approved granting the government warrants to buy discounted shares of company stock at a special meeting Wednesday.

The action allows the U.S. Treasury to buy 3.6 million shares of common stock at $2.98 a share. First Place stock closed unchanged Wednesday at $4.56.

Steve Lewis, First Place president and chief executive, said the government hasn’t indicated when it would take action on the warrants.

The warrants are in addition to 73,000 shares of preferred stock that the Treasury received for providing a $73 million investment in the company.

The money for the investment is part of the $700 billion approved by Congress last year to loosen the nation’s credit markets.

First Place officials decided to accept the investment to enhance its lending programs and improve its capital position, Lewis said.

About $31 million of the investment has been directed to First Place Bank, a subsidiary of the Warren-based holding company. That money will be used for loan programs and to increase the capital on hand at the bank in case the economy worsens, Lewis said.

The rest of the money remains with the holding company. It can be used for various purposes, including acquisitions and business expansion.

First Place must pay the Treasury a 5 percent annual dividend for the first five years that it has the money. That rate increases to 9 percent for the next five years.

Lewis said the company hasn’t established yet when it would pay the money back.