A settlement is expected to be completed within a month between the federal government, One Bank and Trust Co. of Little Rock and others, the bank said Monday.
"This agreement will create a significant recovery of capital, which will strengthen the bank and position the institution for future growth," the bank said in a statement.
No details of the settlement were released Monday.
In 2013, federal prosecutors filed a lawsuit for more than $17.8 million, including almost $17.7 million in benefits from a life insurance policy on Layton Stuart. The lawsuit was filed in U.S. District Court for the Eastern District of Arkansas.
The $17.7 million in benefits was seized by the government.
Stuart was the former owner, chairman and chief executive officer of One Bank who died in 2013. He was removed from his positions at the bank in 2012 by federal regulators.
The federal government has retained about $14.9 million of the money it seized. It repaid the bank last year about $3 million for the premiums it paid on Stuart's life insurance policy.
If the settlement is completed, lawsuits against Stuart's estate will be dropped, said Jerry Pavlas, chief executive officer of One Bank.
"All litigation among all the parties will go away" if the settlement is finalized, Pavlas said.
The parties to the litigation have been working for more than two years on a possible settlement, Pavlas said.
"This will be huge when [the settlement is completed]," Pavlas said. "It will really put the bank in a really safe place when it happens. It will help us accelerate our return to profitability."
Richard Torti Sr., trustee of Stuart's trusts and executor of his will, said there are still a lot of details to be ironed out in the settlement.
"We have an agreement in principle," Torti said.
If approved, the settlement portion for the Stuart family will be for more than Torti anticipated when he first began his duties in 2013, Torti said.
"I'm happy and I'm sure [the Stuart family] will be happy, too," Torti said. "This has been a hard trip, but I feel like it has come to an agreement that everybody can live with."
A trial has been scheduled for the week of Aug. 17. But because of the tentative agreement, Chris Thyer, U.S. attorney, asked the court last week to continue the trial date and that all deadlines in the case be extended.
Among other allegations, the federal government claimed that Stuart made false statements in the application for more than $17 million that One Financial Corp., parent company of One Bank, made for federal funds in the Troubled Asset Relief Program.
Business on 07/28/2015