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Next, Mr. Wahlgren correspondingly adjusted the historical
book value of the Company assets. He especially concentrated on
the value of the Company’s 94.6-percent interest in the Bank,
which he computed on the basis of the adjusted book value of the
stockholders’ equity in the Bank. The adjustments to the assets,
liabilities, and stockholders’ equity amounts on the Company’s
books are described below:
Balance Sheet
Items Hist. BV Adjustment Adjusted BV
Assets $4,612,582 $1,502,081 $6,114,663
Liabilities 9,850 2,534 12,384
Stockholders’
equity 4,602,732 1,499,547 6,102,279
After making adjustments to both the Company’s and the
Bank’s books, Mr. Wahlgren decided to establish the fair market
value of the Company on a net asset value basis. Because the
Company’s primary asset consisted of the 94.6-percent ownership
interest in the Bank (and there were minimal liabilities), Mr.
Wahlgren derived the value of the Company by primarily
considering the Bank’s independent fair market value.
In order to arrive at the fair market value of the Bank, Mr.
Wahlgren evaluated five factors which he had previously relied on
to compare privately owned Nebraska banks sold within 12 months
before or after November 1992: (1) Bank size, (2) market served,
(3) historical growth of deposits, (4) loan portfolio quality,
and (5) profitability. After considering the above factors (in
terms of the adjusted book values of the Bank) and using the
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Last modified: May 25, 2011