Simmons first decides not to participate in CPP.(BANKING & FINANCE)

Simmons First National Corp. of Pine Bluff said last week that it will not participate in the U.S. Treasury's Capital Purchase Program.

The program was introduced in October 2008 in an effort to strengthen the banking system by providing strong banks with additional capital in case the breadth and depth of the recession was greater than anticipated.

About 600 banks nationwide have participated in the CPP.

Simmons was the 32nd bank in the country to be approved, with funding to be at $60 million. While Simmons was among the first banks approved, funding was delayed because the bank's management sought extensions.

"The delay in funding has certainly worked in our favor by allowing us to monitor the economy," said J. Thomas May, chairman and CEO. "As we stated previously, our purpose for applying was simply an issue of insurance, since you can never have too much capital during a period of turbulence.

"After careful consideration and analysis, Simmons First believes there has been considerable improvement in the economic indicators since October. The Arkansas economy is doing well relative to many other geographic regions of our country, and Simmons First continues to have strong asset quality, liquidity and capital. Accordingly, we do not believe participation in the CPP is necessary nor in the best interest of our shareholders," May said.

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