WASHINGTON — The U.S. economy expanded at a sluggish pace this spring as businesses sharply reduced their stockpiles of goods and spent less on new buildings and equipment.

The Commerce Department says gross domestic product, the broadest measure of the economy, increased at an annual rate of 1.1 percent in the April-June quarter. That is slightly below its previous estimate last month of 1.2 percent growth.

Consumers offset the corporate cutbacks by spending at the fastest pace in six quarters. That suggests steady job growth and modest pay gains are fueling healthy demand that could spur faster growth in the second half of this year.

The economy has expanded at a lackluster 1 percent annual pace in the first half of this year, a reminder of the current recovery's weakness.

(Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

WASHINGTON — Federal Reserve Chair Janet Yellen said Friday that the case for raising interest rates has strengthened in light of a solid job market and an improved outlook for the U.S. economy and inflation. But she stopped short of offering any timetable.

(Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

The Chapter 11 filing by Little Rock’s Allcorp Inc. in July marks the third Arkansas bank holding company to enter bankruptcy court in four years.

Allcorp is the parent company for the smallest bank in the state: $16.3 million-asset Community State Bank of Bradley (Lafayette County).

The biggest debt listed in Allcorp’s bankruptcy petition is more than $1.2 million owed on a loan from Heartland Bank of Little Rock. The loan, which originally totaled $2.1 million, financed the purchase of the bank in September 2010.

The reorganization petition is tied to the bank’s inability to generate adequate dividends for Allcorp to service its debt.

Allcorp is the second holding company taken into bankruptcy under similar circumstances by the father-son team of Lex and Alex Golden. Their Acme Holding Co., parent company of Allied Bank of Mulberry (Crawford County), is entering its 29th month in bankruptcy court.

An Aug. 15 order by federal regulators is expected to make moot Acme’s languishing Chapter 11 reorganization-turned-Chapter 7 liquidation. The Federal Reserve Bank of St. Louis gave the Goldens 30 days to come up with a plan to rebuild Allied’s severely depleted capital or to sell the bank.

Translation: The Goldens’ days at Allied Bank are on a 30-day countdown, and regulators will be installing new ownership/management.

Bad loans have battered Allied for more than five years and eroded its tier one equity capital to $1.3 million as of June 30. Past regulatory actions have blamed poor loan review and credit underwriting for the bank’s problems.

Allied recorded a 1.8 percent capital ratio during the second quarter, the lowest of all financial institutions in Arkansas. Community State Bank’s capital ratio, by comparison, is 14.3 percent.

Acme’s bankruptcy in April 2014 trailed nine months behind the Chapter 11 filing of Rogers Bancshares Inc., parent company of Metropolitan National Bank.

The subsequent auction of Metropolitan stock to Simmons Bank of Pine Bluff followed a less contentious path than Acme Holding. The same goes for the repayment of personally guaranteed loans secured by bank stock.

About $8 million owed to Centennial Bank of Conway, on a loan secured by Metropolitan shares and guaranteed by Doyle Rogers Sr., was repaid before the 2013 auction.

It took a year for Chambers Bank of Danville to obtain a $2 million judgment against Lex Golden and his wife, Ellen, for some of the Acme debt they personally guaranteed. Their son, Alex, is listed as a co-debtor on the $1.2 million Allcorp loan from Heartland.

Community State Bank’s tier one equity capital totals nearly $2.3 million.

Ownership of Allcorp largely is divided between Alex Golden, president of the holding company, and Lex Golden, Allcorp chairman and CEO. Each owns 39.28 percent.

Jacksonville investors Frank Swift Jr. and Michelle Andrews each hold a 4.62 percent stake. Trusts for the children of Alex Golden and his sister, Amy McCay, each hold 4.37 percent. Rounding out the ownership are three more Jacksonville investors who have 1.15 percent shares: William/Pamela Hall, Terry/Tonia Weatherford and the Rice Family Living Trust, led by Susan Rice.

Community State Bank

Bradley

Total Assets: $16.3 million
Salaries: $139,000
Net Income: $54,000
Dividends: $17,000
Staff: 6
(As of June 30)

Source: Federal Deposit Insurance Corp. All dollars in thousands.

A 140-bed nursing home in south Pulaski County tipped the scales at $4.05 million.

Dixon Realty LLC of Wood-Ridge, New Jersey, purchased the Madison Health & Rehabilitation project at 2821 W. Dixon Road from Trinik Holdings LLC, led by Saeed Niksefat.

The deal was backed as part of a $15.7 million loan overseen by Oxford Finance LLC of Alexandria, Virginia.

The 9.09-acre development previously was tied to a March 2012 mortgage of $3.2 million held by Farmers Bank & Trust of Magnolia.

The property was bought at a $2 million foreclosure sale in May 2008. The transaction followed a $5.7 million judgment two months earlier against Southwest Nursing Homes Inc., led by Stafford Kees.

Wendy’s Transaction

A 3,400-SF fast-food eatery in west Little Rock weighed in at $2.11 million.

Sea Salt LLC of Memphis acquired the Wendy’s at 17716 Cantrell Road from Fourjay LLC, led by John Shanks.

The deal is financed as part of a $4 million loan from Independent Bank of Memphis. The 1.19-acre development previously was linked with an August 2013 mortgage of $1.3 million held by the bank.

Fourjay purchased the location for $831,000 in February 2013 from Ranch Properties Inc., led by Ed Willis.

Saddle Creek Sale

A 6,992-SF office building in west Little Rock changed hands in a $940,000 sale.

Jason and Sarah Everett bought the 8221 Ranch Drive project from Saddle Creek Center LLC, led by Ed Willis.

The deal is funded with an $884,000 loan from First Security Bank of Searcy.

The 1.01-acre development previously helped secure a November 2010 mortgage of $2.3 million held by the bank. The land was acquired in August 1984 as part of a $2.15 million land deal with Johnson Land Co., led by Glenn H. Johnson.

Sustainable Purchase

A 7,980-SF industrial building in east Little Rock is under new ownership after a $450,000 deal.

Sustainable Properties LLC, led by Chris Adner and Matt Bell, purchased the Arrow Printing project at 1403 E. Sixth St. from the namesake trust of Jerry and Billy Neal.

The deal is backed with five-year loans of $382,500 and $270,300 from IberiaBank of Lafayette, Louisiana.

The Neals bought the 1.13-acre de-velopment for $240,000 in April 1997 from Darragh Investment Co., led by Thomas Darragh.

Restaurant Acquisition

A 2,481-SF eatery in southwest Little Rock rang up a $281,937 sale.

SCFRC-HW-G LLC of Princeton, New Jersey, acquired the Sam’s Southern Eatery at 6205 Baseline Road.

The seller is CNL APF Partners Ltd., an affiliate of GE Capital of Norwalk, Connecticut.

The 0.76-acre development was purchased for $541,000 in June 2003 from SHN Properties LLC of Nashville, Tennessee.

Sherwood Site

A 2.75-acre commercial site in Sherwood drew a $175,329 transaction.

CKP Commercial Properties LLC, led by Paul and Andrea Wilson, bought the land at the northwest corner of Highway 107 and Millers Park Drive. The seller is 107-Oakdale LLC, led by Byron McKimmey.

The deal is financed with a two-year loan of $169,000 from Arvest Bank of Fayetteville.

The land was acquired in February 2006 as part of an $8.3 million transaction with Metropolitan Land Co., representing the heirs of Justin Matthews and his Metropolitan Trust.

Estates Sale

A 6,985-SF home in west Little Rock’s Valley Falls Estates neighborhood tipped the scales at $1.25 million.

Matthew and Patricia Jones purchased the house from Brett and Amanda Bennefield.

The deal is funded with a 15-year loan of $417,000 from First Security Bank.

The property was bought for $1.35 million in October 2013 from the Gene Graves Revocable Trust.

Chenal Circle Abode I

A 6,605-SF home in the Chenal Circle neighborhood of west Little Rock sold for $955,000.

The Linda D. Gleason Revocable Trust acquired the house from Phillip and Robin Johnson.

The deal is backed with a five-year loan of $859,500 from Citizens Bank of Batesville.

The residence previously was tied to a $620,000 loan held by Summit Bank of Arkadelphia.

The Johnsons purchased the property for $760,000 in April 2014 from Bank of New York Mellon.

Hickory Creek House

A 4,915-SF home in west Little Rock’s Hickory Creek neighborhood changed hands in an $825,000 transaction.

Johnathan and Julia Goodwin bought the house from CBM Appraisals Inc., led by Christopher Maris.

The deal is financed with a 30-year loan of $742,500 from Stifel Bank & Trust of St. Louis. The residence previously was linked with a November 2014 mortgage of $690,000 held by Southern Bancorp Bank of Arkadelphia.

CBM acquired the property for $620,000 nearly two years ago from Calvin and Joyce Arnold.

Maisons Residence

A 6,099-SF home in The Maisons neighborhood of west Little Rock’s Chenal Valley development is under new ownership after a $695,000 sale.

Vijay and Grace Raja purchased the house from David and Tracy Rhodes.The deal is funded with a 25-year loan of $660,250 from Regions Bank of Birmingham, Alabama.

The residence previously was tied to an August 2007 mortgage of $250,000 held by the bank.

The Rhodes family bought the location for $72,000 in April 2004 from Deltic Timber Corp. of El Dorado.

Chenal Circle Abode II

A 5,807-SF home in the Chenal Circle neighborhood of west Little Rock rang up a $550,000 transaction.

Sara Hanna acquired the house from Debora Owens. The deal is backed with a 15-year loan of $412,500 from One Bank & Trust of Little Rock.

The residence previously was linked with a September 2006 mortgage of $550,000 held by Bank of England.

The property was purchased for $875,000 nearly 10 years ago from the Paul & Ann Weaver Family Trust.

Woodland’s Home

A 3,827-SF home in the Woodland’s Edge neighborhood of west Little Rock drew a $539,000 sale.

Matthew and Michelle Barden bought the house from Arbor Construction LLC, led by Michael Moran. The deal is financed with a 30-year loan of $417,001 from JPMorgan Chase Bank of Columbus, Ohio.

The residence previously was tied to a November 2015 mortgage of $409,600 held by Bear State Bank of Little Rock.

Arbor acquired the site for $76,000 nine months ago from Rocket Properties LLC, led by Lisenne Rockefeller and Ron Tyne.

Noah’s Mortgage

A 10,662-SF Noah’s event center in west Little Rock is securing a $3.1 million financial package.

NC Little Rock 642 LLC of Frisco, Texas, obtained the loan from EquiTrust Life Insurance Co. of Chicago.

The 1.7-acre site at 21 Rahling Circle was purchased for $859,636 in May 2014 from Deltic Timber Corp.

Motel Financing

The owner of a 55-room motel in North Little Rock landed a $2 million funding agreement.

Shree Mahalaxmi Corp. of Humble, Texas, got the three-year loan from Farmers & Merchants Bank of Stuttgart.

The 1.2-acre Simply Home Inn & Suites development at 110 E. Pershing Blvd. previously was linked with a May 2015 mortgage of $1.2 million held by the bank.

SMC bought the property for $1.3 million in March 2015 from KMP LLC, led by Kolila Patel.

The top man at the world’s largest company is again the highest-paid executive in Arkansas.

C. Douglas McMillon, CEO of Wal-Mart Stores Inc., has returned to the No. 1 spot on the annual list of executive compensation at publicly traded companies headquartered in the state. McMillon, whose total compensation topped $19.8 million in 2015, had been displaced on last year’s list by Gregory S. Foran, who benefited from stock awards granted when he was named executive vice president in 2014.

McMillon and Foran, No. 4 this year, are among six current Wal-Mart executives ranked among the 10 highest-paid executives on this week’s list. It ranks executives of 20 publicly traded companies headquartered in Arkansas by total compensation as disclosed in the companies’ most recent proxy statements. In most cases, the fiscal year ended Dec. 31, 2015; exceptions are Tyson Foods Inc. (Oct. 3, 2015); Dillard’s Inc. (Jan. 30); Wal-Mart (Jan. 31); Acxiom Corp. (March 31); and America’s Car-Mart Inc. (April 30).

Sandwiched between McMillon and Foran are:

• Roger W. Jenkins, CEO of Murphy Oil Corp. of El Dorado, which recorded the lowest net income of the 20 companies last year — a $2.27 billion loss, thanks to the cratering of petroleum prices; and
• Donnie Smith, CEO of Tyson Foods, the second-largest company in the state in terms of both revenue ($41.4 billion) and net income ($1.2 billion).

In a numerically satisfying coincidence, exactly 100 executives are ranked this year, up from 94 in 2015 mainly because the roster of public companies issuing regular proxy statements grew by one: Communications Sales & Leasing Inc. of Little Rock, which was spun off of Windstream Holdings Inc. in April 2015.

The total compensation for the 100 executives totaled $269.3 million, and the average of just under $2.7 million was down from $2.96 million last year.

Arkansas Business’ list breaks down total compensation into salary, the calculated value of stock and stock options awarded, bonuses or other cash performance pay, plus any other compensation reported to the U.S. Securities & Exchange Commission.

Only about 18 percent ($48.7 million) of the aggregate compensation came in the form of base salary, reflecting the preference for performance-based compensation of proxy advisory firms like Institutional Shareholder Services Inc. of New York.

Compensation totals ranged from McMillon’s $19.8 million to the $160,000 annualized base salary reported for Michelle Dillard, the ninth member of the founding family to join the payroll of the Little Rock retailer.

Most of the companies reveal the pay packages only of the top managers — what the SEC calls “named executive officers” — but Dillard’s Inc. also discloses the compensation of a sister (Denise Mahaffy) and children of CEO William Dillard II (William III) and President Alex Dillard (Alexandra, Annemarie and Michelle). Executive Vice Presidents Mike Dillard and Drue Matheny, brother and sister of William II and Alex Dillard, are also named executive officers.

Total compensation for the nine family members totaled $12.5 million last year. That was almost exactly the amount that John Tyson, chairman of Tyson Foods of Springdale, realized by exercising stock options last year.

Tyson also collected compensation of $8.75 million, placing him No. 7 on the list.

Cash realized by the exercise of stock options is reported on the list but is not included in the compensation total. Tyson was among only 29 of the 100 executives who exercised options during 2015; the other 28 divided up almost $48.6 million.

Kirk Thompson, chairman of J.B. Hunt Transport Inc. of Lowell, No. 30 on the list with total compensation of $2.27 million, realized the second-highest payday by exercising stock options: an additional $7.7 million.

Others in the top 10 are three executive vice presidents at Wal-Mart: No. 5 Neil M. Ashe, No. 6 David Cheesewright and No. 10 Rosalind G. Brewer, the highest-paid woman on the list. M. Brett Biggs, No. 8 with total compensation of $8.6 million in 2015, was promoted to chief financial officer upon the retirement in January of No. 23 Charles M. Holley Jr.

Noel M. White, senior group vice president for Tyson Foods, landed at No. 9.

10 Women

Among the 100 executives on the list are 10 women, starting with No. 10 Brewer, who heads Wal-Mart’s Sam’s Club division. Half of them are the Dillard women:

• No. 42 Drue Matheny;
• No. 73 Denise Mahaffy;
• No. 93 Alexandra Dillard;
• No. 96 Annemarie Dillard; and
• No. 100 Michelle Dillard.

Michelle Dillard and No. 51 Kelli M. Hammock, a senior vice president at Murphy Oil Corp., are newcomers to the list. The other female executives are:

• No. 31 Judy R. McReynolds, CEO of ArcBest Corp. of Fort Smith;
• No. 34 Shelley Simpson, executive vice president of J.B. Hunt; and
• No. 35 Mindy K. West, chief financial officer of Murphy USA Inc. of El Dorado, the retail spinoff of Murphy Oil.

New Names

Biggs, Hammock and Michelle Dillard were among 22 new names on this year’s list.

Communications Sales & Leasing, the Windstream spinoff, contributed three newbies:

• No. 12 Kenny Gunderman, president and CEO;
• No. 48 Mark A. Wallace, EVP and CFO; and
• No. 55 Daniel L. Heard, SVP and general counsel.

Other newcomers are:

• No. 27 John Eckart, CFO of Murphy Oil;
• No. 29 Richard E. Erwin, president and general manager of audience solutions for Acxiom of Little Rock;
• No. 36 Nicholas Hobbs, president of dedicated contract services for J.B. Hunt;
• No. 44 Brian S. Davis, CFO of Home BancShares Inc. of Conway, parent company of Centennial Bank;
• No. 46 Keith S. Caldwell, SVP and controller for Murphy Oil;
• No. 47 Kevin Hester, chief lending officer for Home BancShares;
• No. 49 S. Travis May, president and general manager of connectivity for Acxiom;
• No. 63 Timothy D. Thorne, president of ArcBest’s Arkansas Best Freight division;
• No. 64 Phillip R. Watts and No. 69 Chris B. Johnson, co-principal financial officers for Dillard’s;
• No. 66 David M. Redmond, president of consumer and SMB for Windstream;
• No. 75 David R. Cobb, VP and controller for ArcBest;
• Mark McFatridge, CEO of Bear State Financial Inc., who came in at No. 82 because his total compensation of almost $620,000 represented only three months of work leading the holding company for Bear State Bank; and
• No. 91 Christian C. Rhodes, VP and chief information officer for USA Truck Inc. of Van Buren.

Two others made their first and last appearances:

• No. 58 Thomas M. Glaser, who served as interim president and CEO of USA Truck after the resignation of No. 37 John Simone in 2015. Glaser was succeeded by Randy Rogers in January, and Simone died of lung cancer in March.
• No. 78 Joseph Henderson III, who resigned as VP of fuels for Murphy USA in December.

Already Gone

Holley, Glaser, Simone and Henderson aren’t the only names on the list who have since left their positions. Others who are already gone include:

• No. 59 David L. Bartlett, who retired in January as president and chief banking officer for Simmons First National Corp. of Pine Bluff;
• No. 77 Russell Overla, who resigned in September as executive vice president of Truckload Operations for USA Truck;
• No. 90 Michael R. Weindel Jr., another USA Truck EVP who resigned in February;
• No. 94 Kevin G. Fitzgerald, who retired as EVP and CFO for Murphy Oil Corp.; and
• Randy Mayor, who came in at No. 99 after retiring as CFO for Home BancShares in July 2015.

White Rock Investments LLC, led by Tim Brisiel of Fayetteville, paid $5 million for two apartment complexes.

Brisiel bought the Colonial Arms Apartments on North Leverett Avenue. Colonial Arms has 69 units and more than 55,000 SF. The acquisition included the 74-unit Oakwood Place Apartments on West Putnam Street.

Brisiel purchased the properties from Mid-America Management Associates, which is led by William Howell. First National Bank of Fort Smith assisted the purchase with a loan of $5.6 million.

Townhouses Sold

Brisiel, through his White Rock Investments LLC, sold 10 townhouse units to a California real estate investor.

Christ Koutroumbis and his wife, Polly, through their 1337 & 1343 N. Oakland LLC, paid $1.35 million for the units at 1337 N. Oakland Ave. The units have 8,976 SF.

Arvest Bank of Rogers assisted the purchase with a loan of $1.08 million.

Investors Buy 2 Hotels

The private investment group Waramaug LS Hotels of Boca Raton, Florida, bought the Holiday Inn Express & Suites in Bentonville and the Fairfield Inn & Suites in Springdale, paying $6.9 million for the Holiday Inn and $7 million for the Fairfield.

Waramaug bought the properties in partnership with Woodmont Lodging of Bethesda, Maryland. The partnership bought the Holiday Inn through its WW Holx Bentonville LLC and the Fairfield Inn through its WW FFI Springdale LLC.

Narendra Krushiker was the seller. Benefit Street Partners CRE Finance LLC of New York City assisted the purchases with a loan of $11.1 million.

Waramaug said the partners plan to renovate the 84-room Holiday Inn, located at 2205 SE Walton Blvd. The Fairfield Inn is a 74-room hotel at 1043 Reiff St.

Craig Nussbaum, the senior vice president of Waramaug, said the hotels were attractive because they were located in cities with major corporations; Bentonville is home to Wal-Mart and Springdale is home to Tyson Foods.

“Both markets also have a strong job creation forecast and consistent economic growth coupled with a limited new supply outlook,” Nussbaum said. “All of these factors provide excellent future growth potential for our top-line revenue.”

Simmons Buys Bank Branch

Simmons Bank of Pine Bluff bought a former First Federal Bank branch in Fayetteville for $1.7 million.

The branch, located at 2025 N. Crossover Road, was sold by the renamed Bear State Bank of Little Rock. The branch is 3,639 SF.

Red Robin Sale-Leaseback

The Red Robin restaurant in Fayetteville was sold by its corporate owner in a $2.35 million deal.

Red Robin International Inc. of Greenwood Village, Colorado, sold the restaurant at 695 E. Van Asche Drive to two California trusts. The Jane J. Vorhees Survivor Trust bought 57 percent, while the V Purn Vorhees Credit Shelter Trust bought the remaining 43 percent.

Both trusts are led by Jon Vorhees of Roseville, California.

Red Robin signed a 15-year lease with the new owners after the sale of the 6,606-SF restaurant.

Dentist Office Changes Hands

A California investor paid $2.35 million for the My Dentist office at 2868 W. Martin Luther King Jr. Blvd. in Fayetteville.

Yancey Properties of Santa Barbara, California, led by Thomas Yancey and Joel Orr, bought the property from Broadstone MD Oklahoma LLC, a subsidiary of Broadstone Real Estate of Rochester, New York.

Yancey Properties bought two adjacent lots, both one-third of an acre. One lot is the My Dentist parking lot, and the other undeveloped lot sits directly behind the 5,268-SF office building.

The property is located across MLK from the Walmart SuperCenter. Great Lakes Credit Union of Illinois assisted the purchase with a loan of $935,000.

Investment Firm Sold

The home of Greenwood & Gearhart, an investment advisory firm in Fayetteville, sold for $1.25 million.

The Firethorn Group LLC, led by Lindsey and George Gearhart, bought the 8,600-SF office at 26 E. Center St. Crickett LLC, led by M. Reed and Mary Ann Greenwood, was the seller.

Mary Ann Greenwood founded the company in 1982.

Legacy National Bank of Springdale assisted the purchase with a loan of $1 million.

An insurance company had a straightforward $300,000 commercial letter of credit from First Community Bank of Eastern Arkansas, and that’s bad news for the Marion bank with $150.8 million in assets.

Last week, U.S. District Judge D.P. Marshall Jr. ordered the bank to pay Arch Specialty Insurance Co. of New York the $300,000 plus nearly $45,000 in interest for refusing to honor the letter of credit, and there may eventually be court costs to pay as well.

Arch was represented by attorneys Lance Miller and Stan Smith of the Little Rock law firm of Mitchell Williams Selig Gates & Woodyard.

The bank issued the letter of credit back in November 2007 on behalf of Crittenden Regional Hospital in West Memphis. Arch had provided insurance coverage to the hospital, but it required a letter of credit that would cover the deductible on the policy if the hospital didn’t pay.

And that’s exactly what happened.

And as you probably remember, Crittenden Regional filed for Chapter 7 bankruptcy liquidation in September 2014. In December of that year, Arch Specialty Insurance asked First Community Bank for the $300,000, but the bank refused to pay.

Compounding the problem, the hospital didn’t list the bank as a creditor in the bankruptcy filing, and it’s too late for the bank to file a claim in the bankruptcy case, according to the bank’s pleadings in U.S. District Court in Jonesboro.

First Community’s attorney, Stuart Hankins of Sherwood, argued in his filings that the letter of credit wasn’t straightforward or ordinary. He said the bank shouldn’t have to pay it for several reasons, including the fact that Arch never contacted the bankruptcy court about the letter of credit.

But Judge Marshall, in his order, boiled the dispute down to the question of whether the bank improperly refused to honor the letter of credit. He found that it did and “must pay on an unconditional letter of credit regardless.”

Hankins didn’t return a call for comment.

The bank had net income in 2015 of $1.4 million, which was about the same as the previous year.

Remember the settlement between Johnelle Hunt’s BHL Financing LLC and Little Rock’s One Bank & Trust we told you about two months ago?

We have more details.

The outcome of that federal case is that BHL received assets valued at $2.8 million.

The list includes:

• The trust-preferred shares issued by West Tennessee Bancshares Inc., holding company for the $337 million-asset Bank of Bartlett, valued at $1.2 million,
• The 7,200-SF Parker Building at 4 Country Club Circle in Maumelle, $800,000;
• A 2.5-acre commercial site at the southwest corner of Highways 5 and 89 on the edge of Cabot; and
• $200,000 in cash.

You might recall the lawsuit got rolling after BHL landed a $14.7 million default judgment last September against One Bank's holding company, OneFinancial Corp.

The action represented a second lawsuit to collect on financial guarantees made by One Bank’s former owner and CEO, Layton “Scooter” Stuart, who died in March 2013.

The guarantees are tied to an October 2002 reworking of $30 million of debt amassed by Stuart in business dealings with Hunt’s late husband, J.B. Hunt, founder of J.B. Hunt Transport Services Inc. of Lowell.

A chunk of that debt was tied to the Hunt family selling its interest in One Bank to Stuart.

Did you know the construction lender on Scott Reed’s comatose K Lofts project in downtown Little Rock recently launched a foreclosure action?

IberiaBank of Lafayette, Louisiana, sued to recover more than $1.4 million owed on an original June 2013 loan of $1.3 million to the ne’er-do-well developer.

Reed of Portland, Oregon, and Brian Corbell of Los Angeles both personally guaranteed the debt of their K Lofts LLC.

According to the bank’s complaint, the borrowers triggered a default by failing to maintain the debt-service ratio, failing to timely complete construction, ceasing construction and more.

The renovated 115-year-old building at 315 Main St. in downtown Little Rock stands mostly vacant, with apartments in a mostly complete state of limbo.

The contractor on the project, Little Rock’s AMR Construction LLC, pulled off the job after April Fools’ Day 2015. The company has a lien claim of $196,440 divided between two contracts.

More than $143,700 is owed on the original $2.1 million contract to redevelop the upper floors of the once-dilapidated five-story building into 32 apartments.

More than $52,600 is owed on an $825,300 contract to repair a partial collapse of the east wall in 2013.

You may recall that AMR filed its own foreclosure suit earlier this year to keep its lien claim in force on K Lofts. At last report, this dispute is headed toward contractually mandated arbitration.

A few weeks shy of the sixth anniversary of trumpeting his K Loft plans, Reed has yet to deliver any completed projects among several failed attempts in Little Rock.

Take a minute and think about this question: What characteristics do you want in people entrusted with your loved ones?

How about the teacher who is responsible for shaping the mind and character of your child for eight hours a day, nine months out of the year? Or the nurse who spends morning, noon and night beside your aging parent’s bed, helping them get dressed, feeding them every meal and making sure they are well cared for?

Good values?

Informed and knowledgeable about their field?

Passionate about the job they do?

You see when it’s our family — our heart connection — we expect those whose jobs it is to help the ones we love to have exceptional values, be extremely knowledgeable about their "expertise" in a subject and to exude passion and energy, which shows that they love what they do every day and their job is much more than a paycheck.

In my 25-year, international career at Caterpillar, I found that these same three principles (hiring and retaining values-driven, informed and passionate people) are the key to true, sustainable success in an organization.

As a leader, you serve in a crucial role that shapes the culture and success of the organization, and your front-line people are the company’s most important resource. They are the “teachers” and “nurses” who we expect to give exceptional care and service to our loved ones.

Gallup’s “State of the Global Workplace” study shows that less than 30 percent of employees are “engaged” and are truly “connected” to their company and are making positive contributions. The majority of workers — more than 70 percent — are disengaged and are essentially “checked out” and are “coasting.” They’re either sleepwalking through their workday, putting time, but not energy or passion into their work or are acting out their unhappiness and are “toxic” to the organization.

How does this play out in terms of business results? What about in quality of life?

People spend the majority of their lives at their workplace. As a result, the work environment has an incredible impact on their lives outside of the office — as parents, spouses and citizens.

Leaders must recognize that their most important job responsibility is investing in their people.

The often overlooked and underappreciated “front line” people can achieve amazing results if their leaders care for them, invest in them, and then hold them to high expectations. When your people know that the organization cares about them, not just in terms of what they deliver to the bottom line, but as human beings, when they see the organization investing in them through training and development, and they experience the organization holding them to high expectations, amazing things happen. In this work culture, your people will return the favor and care deeply about your organization (and not just about their paychecks), leading to significantly improved business results. Society will also benefit because people in these environments will become better parents, spouses and citizens as a result of reinforced values, increased dignity and a new sense of purpose.

So, in this era of cynicism and self-centeredness — especially in business — we encourage you to be wildly different and transform your organization into one of true values and ethics, unbridled passion and energy, and one with a sense of purpose that will attract the “best of the best” employees and passionate customers/clients who will line up in droves to be associated with an organization ... like yours.

About Jon Harrison

At the peak of a successful 25-year career at Caterpillar Inc. (including director-level positions in Australia, Japan, and most recently, as general manager for their new, world-class manufacturing facility in North Little Rock), Jon left corporate America to follow his calling of serving people that are often overlooked and underappreciated. 

This transition from a career focused on “success” to one that focuses on “significance” was an easy one for Jon as the common theme during his career at Caterpillar was his passion for people. Jon is known as a leader who places special attention on the “front-line” team members who are often ignored in many organizations. Driven from this passion, Jon founded his own company, VIP2, (Values-driven, Informed, Passionate People). VIP2, through several avenues, assists organizations with this critical journey, resulting in successful organizations and transformed lives. 

Jon holds a Bachelors of Science degree in Business Economics from the Kelley School of Business at Indiana University, and is a graduate of the Advanced Management Program at Duke University. 

WASHINGTON — U.S. banks' earnings in the April-June period rose 1.4 percent from a year earlier as growth in lending fueled interest income.

(Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

Arvest Bank announced Thursday the promotion of Jim Cargill to president and CEO for the bank's central Arkansas market.

Cargill currently is president and sales manager for the market, where he is responsible for retail and consumer banking operations. He will succeed CEO John Womack, who will retire on Sept. 30.

In his new role, Cargill will be responsible for all aspects of banking operations and strategic direction for Arvest in central Arkansas, which includes more than 450 employees and 32 banking locations.

"Jim has been part of our growing company for more than 30 years and has greatly contributed to the success of Arvest by ensuring we deliver customer-focused banking, provide customers with convenient and comprehensive financial solutions and stay on the cutting-edge of emerging new technologies in our industry," Womack said in a news release. "I'm excited for Jim to take over leadership of the great team here in central Arkansas and look forward to the continued success he will foster for our customers and our communities."

Womack joined Arvest in 1999 and served for 11 years as president of the bank's Fort Smith market before being named CEO of the central Arkansas territory.

Cargill is a native of Lewisville (Lafayette County) and a fourth-generation banker who began his career at his family's bank, First National Bank in Lewisville.

He has held a number of leadership roles during his career with Arvest and has worked in Rogers, Bentonville and Little Rock. He serves on the board of the Arkansas Bankers Association, the University of Arkansas at Little Rock Foundation, Our House and the Little Rock Regional Chamber of Commerce. He is a member of the Rotary Club of Little Rock.

Acxiom Corp. of Little Rock on Thursday announced that it has completed the sale of its Impact email business to Zeta Interactive of New York City for $22 million. 

The publicly traded data services company (Nasdaq: ACXM) first reported its intention to sell the email business for that amount in first-quarter results filed Aug. 4 with the Securities & Exchange Commission.

Acxiom also said in the report that it intended to enter into a separate multi-year contract to provide Zeta Interactive with services from its connectivity and audience solutions segments.

On Thursday, the company said it would use proceeds from the sale to buy back more shares of stock. Its board of directors has increased the share repurchase authorization by $100 million to $400 million and extended the program through June 30, 2018.

Zeta Interactive was founded by David A. Steinberg and John Sculley, a former CEO of Apple Inc. and PepsiCo.

LITTLE ROCK - Arkansas finance officials say the state's revenue in August fell below expectations and below the same month last year.

The Department of Finance and Administration on Friday said last month's net available revenue totaled $416.1 million, which is $5.2 million below August 2015 and $8.4 million below forecast. The state's net available revenue for the fiscal year that began July 1 totals $816.8 million, which is $3.8 million below the same point last year and $15.3 million below forecast

DFA said sales tax collections in August were below the same month last year and forecast, due partly to one-time audit payments received last year. Last month's individual income and corporate tax collections were also below the August 2015 figures and the forecast.

(Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

John W. Ahlen IV joined the Arkansas State Bank Department as bank chief counsel Aug. 29. In his new position, Ahlen will be responsible for preparing case strategy and serving as an expert litigator before federal and state courts and agencies. He also will be the bank commissioner’s chief legal adviser on all banking issues, including the drafting of legislation and Bank Department rules and regulations.

Ahlen began his career as a project assistant with the law firm Wilmer Cutler Pickering Hale & Dorr LLP in Washington. He returned to Arkansas and went on to serve as assistant parliamentarian and legislative analyst for the Arkansas House of Representatives. Most recently, Ahlen was general counsel for the state auditor, joining that office in 2015. Ahlen is a member of the Arkansas Bar Association and serves on the ABA’s Governance Committee and Uniform Laws Committee.

Ahlen received a bachelor’s degree in history, with an emphasis on politics, from Hendrix College in 1998. He received his Juris Doctor from the William H. Bowen School of Law at the University of Arkansas at Little Rock in 2014.

Cal Rose has joined the Rogers office of Wright Lindsey & Jennings as an associate attorney advising clients on business and tax-related issues. The Blytheville native has three years of experience with another northwest Arkansas law firm.

See more of this week's Movers & Shakers, and submit your own announcement at ArkansasBusiness.com/Movers.

Eight women and a congregation of Catholic nuns were the second class of inductees honored by the Arkansas Women’s Hall of Fame at a banquet in Little Rock on Aug. 25.

The nonprofit Hall of Fame was incorporated in 2014 as a joint project of the North Little Rock Chamber of Commerce and Arkansas Business Publishing Group, and major sponsors of the event include Centennial Bank of Conway, BMW of Little Rock and Eagle Bank, also of Little Rock.

Nominations for the 2017 class of inductees are being accepted online at ARWomensHallOfFame.com. See profiles and biographies of this year's class at ArkansasBusiness.com/AWOF.

Little Rock’s Heartland Bank avoided major fallout from overzealous real estate lending by operating with a different business model. More than five years down the road from the bursting real estate bubble, Heartland and its largest shareholder were battered by loans related to another sector: oil and gas.

Both Heartland and Walter Quinn, lead shareholder in the $227 million-asset bank, drew regulatory concerns in the management of problem loans.

During an examination last year, questions were raised about Quinn’s involvement with a reworking of off-book problem loans mixed with new loans.

At the end of a complicated series of transactions, the bank was no better or worse. However, Quinn’s financial position was improved when the bank could have benefited.

Just as Heartland Bank was contending with issues of asset quality and risk management, so too was Quinn in his own business dealings. Were his personal financial issues interfering with his fiduciary duties?

Quinn didn’t want to talk about the specifics of transactions involving Chris Robertson, now a 6.7 percent stakeholder in Heartland, but did regarding his efforts to help the bank deal with problem loans.

“We did improve the bank by taking some loans out of the bank,” Quinn said. “I can’t speak for the regulators, but I would think they would view that as a positive.”

Last year, Quinn stepped down as a bank director and as chairman, president and CEO of Heartland’s parent company, Rock Bancshares Inc.

“I’m on a leave of absence,” he said. “I’m just dealing with my personal investments. My interest is getting Rock Bancshares and Heartland back on track. I’m doing what I can to help at the bank and working on some of my business situations.”

Those situations include a $4.9 million consent judgment in November against Quinn and a string of his ventures tied to his loan default with Prosperity Bank of El Campo, Texas.

That was followed this year by a $585,000 default judgment against him on a corporate jet loan held by Bear State Bank of Little Rock and a lender-mandated for-sale sign on his $5.7 million vacation home in Colorado.

Quinn declined to elaborate on where things stand in efforts to restore order to his financial world. But the 54-year-old Little Rock businessman is open to talking about where the bank has been and where it is going.

“We want to get back to normalcy, and I don’t see why we can’t do that,” he said.

Quinn was in the forefront of new ownership that used a stronger mix of higher yielding commercial loans to transform what was an underperforming, publicly traded thrift in 2004 into a profitable, privately held niche bank.

“Commercial lending, not real estate lending, that was the foundation of the bank and where we wanted to take it,” said Quinn, the man most identified with Heartland Bank. “We were doing a really nice job on that until we had some exposure on the energy side.”

Investors enjoyed a “three times return on their money over a 10-year period,” by his reckoning.

“That’s something I’m proud of,” Quinn said. “I don’t know whenever we’ll be able to get back to that. It depends on how circumstances play out in the next months.”

His fortunes and those of Heartland Bank avoided a severe battering from real estate, but they shared in a beat-down linked to plummeting oil and gas prices.

Quinn and the bank both felt the sting of West Texas Intermediate Crude plummeting from more than $100 a barrel during 2014 to below $30 in mid-January.

“At the end of the day, it’s all about generating the cash flow to support the loan,” Quinn said. “The [regulatory] guidance of that changed after we already had a portfolio” of oil and gas loans.

During a 24-month swing, Heartland Bank posted its biggest annual profit ever and recorded its smallest annual profit since 1999.

Net income of $7.4 million in 2014 plunged to $234,000 in 2015, with oil and gas loans as a prime variable.

Rock Bancshares is two months into a $3 million private placement stock offering to raise capital to support Heartland Bank.

“This isn’t the first time we raised capital,” Quinn said. “The situation is more the deciding factor in that.”

While past efforts raised money to fund growth, this time the purpose is to replenish capital gashed by loan charge-offs.

The bank boosted its capital from $27 million to $33 million heading into 2015 as the buildup of nonaccrual loans gained momentum.

The first-quarter tally of $3.6 million increased to $4.8 million in the second before jumping to $17.1 million in the third quarter and nearly doubling to $34 million at year-end.

Six months later, nonaccrual loans declined to $29.1 million after more than $5.8 million was charged off. Nearly a tenth of its commercial and industrial loan portfolio was zeroed out, 6.2 percent of Heartland’s overall loan portfolio.

Once the life of the dividend party, oil and gas loans were becoming fiscal buzzkills.

Maintaining its capital base while diversifying its loan portfolio and working through problem loans is the order of the day at Heartland.

“That’s the plan,” Quinn said. “We know what’s required, and we know what we need to do. I’d compare Heartland to a lot of banks that went through the real estate crisis of 2008-10.

“We didn’t have the real estate exposure. But part of where we were expanding our loan portfolio is in the energy sector, and that sector is where the real estate market was in 2008-10.”

In 2013, Rock Bancshares raised $10 million through the sale of capital notes.

The holding company followed that in January 2014 with the purchase of its Little Rock office building at 1 Information Way for $7.1 million from Quinn’s Rock Financial Group LLC.

In turn, Rock Bancshares transferred ownership of the 54,772-SF multi-tenant office building to the bank. The four-story project on the Arkansas River houses a Heartland bank branch.

At one time, Quinn’s stake in Rock Bancshares was as much as 75 percent.

“Over the course of years, I’ve sold some additional interest,” Quinn said.

His ownership position stood at 52.3 percent at year-end 2014, at 48.38 percent at year-end 2015 and less than 45 percent most recently.

Joining Quinn as a leading shareholder in Rock Bancshares these days is Craig Benson of Austin, Texas, 17.2 percent.

Last year, Benson stepped into the position held by Dr. Mark van Overbeek of Incline Village, Nevada, who previously held a 17.3 percent stake in the holding company.

Benson also replaced Overbeek as a Rock Bancshares director after he resigned on June 12 from the holding company and as chairman of Heartland Bank.

Judy Lawton, Heartland’s chief operating officer, was named president of the bank and the holding company as part of the board reshuffling.

Heartland Highlights

Total Assets: $227.1 million    Dividends: $500,000     Loans: $180 million    Net Income: $530,000
Tier One Equity Capital: $25.7 million    Full-Service Locations: 5*     Staff: 40
(As of June 30)

*Little Rock, 2; and one each in Bryant, Fordyce and Sheridan.

All dollars in thousands.
Source: Federal Deposit Insurance Corp.

The knottiest white-collar criminal case in recent memory should finally go to trial next month, but only half of the original defendants will face the jury.

“Unless they drop the charges,” defense attorney Lloyd W. “Tré” Kitchens III said last week.

And he said there’s no reason to think federal prosecutors are preparing to dismiss the charges against Michael Heald and Kitchens’ client Brad Paul, two of the four One Bank executives who were named in a March 2015 indictment.

After accepting co-defendant Gary Rickenbach’s second attempt to plead guilty to a reduced charge in July, U.S. District Judge Kristine Baker recently set an Oct. 11 trial date for Heald and Paul.

No date has been set for sentencing Rickenbach.

Rickenbach, for those needing a scorecard, was executive vice president and then senior executive vice president of One Bank when it was under the control of its owner, the late Layton “Scooter” Stuart. He facilitated a $1.5 million loan to a Canadian resident of Florida, Alberto Solaroli, in whose automotive technology company Rickenbach had invested.

Solaroli misrepresented his net worth to the tune of $170 million and never made a single payment on the 2007 loan, and for that he is currently a guest of the federal Bureau of Prisons. Rickenbach, Stuart and the others scrambled to fix the balance sheet through a series of replacement loans that were ultimately repaid, in the fall of 2012, through the sale of real estate that Stuart owned outright.

That happy ending notwithstanding, the cover-up of the Solaroli default — which Rickenbach said he orchestrated with Stuart’s cooperation — was happening in 2008 and 2009. And that coincided with a successful application for federal TARP capital for One Bank’s holding company, One Financial Corp.

In Previous Episodes …

In April 2014, 13 months after Stuart died, Rickenbach was charged with two counts, conspiracy and money laundering, in a case that the special inspector general for the TARP program described as TARP fraud. Rickenbach was eventually charged with five more felonies, including bank fraud and aiding and abetting false entries. In November — eight months after Heald, Paul and Tom Whitehead were added to the indictment — Rickenbach offered to plead guilty to a single count of misprision (that is, failing to report a crime) if he could be guaranteed a probation-only sentence.

Baker finally rejected Rickenbach’s plea offer in July but accepted a plea agreement that suggests a prison sentence of 12-18 months under federal sentencing guidelines. (The judge can “depart” from the guideline range.)

At the U.S. attorney’s request, Baker dismissed the four counts against Whitehead in December. Whitehead’s attorney, Charles D. Matthews of Hot Springs, confirmed at the time that his client had agreed to testify against Heald and Paul, and federal prosecutors have revealed that they also expect to call Rickenbach as a witness.

Heald, who is represented by Gary Corum, will be tried on four charges, one each of conspiracy and money laundering and two of aiding and abetting false entries.

Paul faces the same charges, plus one more count of abetting a false entry. And his lawyer, Kitchens, points out that bank regulators — with full knowledge of the indictment — have allowed Paul to continue working in the industry as a commercial lender for Community First Bank of Harrison (which is being acquired by publicly traded Equity Bancshares Inc. of Wichita, Kansas).

First National Bank of Paragould on Tuesday announced the start of construction on an expansion to its existing branch at 3500 E. Johnson Ave. in Jonesboro. The bank said it expects the project to be completed in the first quarter of 2018.

The bank said construction would not disrupt services offered at its Hilltop Office.

The five-story, 60,000-SF First National Financial Park will be the lead office for FNB’s Craighead County operation. Plans include a community room on the first level and an outdoor terrace; walking paths around a water feature; a large customer parking area; and underground parking for about 50 vehicles.

The bank said the facility will be large enough to provide for future expansion and commercial leasing opportunities.

The bank had $1.09 billion in assets as of June 30 and was the 11th largest bank chartered in Arkansas as measured by assets. It has 14 offices; the branch on Johnson Avenue is 18 years old.  

Citizens Bank of Batesville this week added two to its marketing team.

Don Hale, formerly of the Diamond Agency of El Dorado, has joined the company as senior vice president of marketing. Tim Byers, who has worked for companies including Acxiom Corp. of Little Rock and Merkle Inc. of Baltimore, has joined as vice president of marketing. 

"As Citizens Bank continues to expand, we recognize the importance of developing a strategic marketing team," CEO Phil Baldwin said in a news release. "We are committed to growing our base and increasing our visibility in the markets we serve. This includes utilizing technology to reach new customers and maximizing our reach with traditional media. We believe the addition of these two key positions will allow us to market our products and services at the highest level."

Hale launched the Diamond Agency, a marketing and public relations firm, in 1996. Hale has served on the Arkansas Educational Television Commission, the South Arkansas Development Council, the El Dorado Chamber of Commerce, Main Street El Dorado and the El Dorado Rotary Club.

Byers, a Batesville native, has a decade of experience in digital marketing, analytics and project management. He has worked on projects with clients such as Abercrombie & Fitch, Under Armour, Eddie Bauer and General Motors.

Citizens Bank was founded in 1953. It has more than 150 employees and nearly $770 million in assets. The bank plans to break ground next year on a new five-story headquarters in Batesville.