SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JANUARY 12, 2000
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COASTAL BANCORP, INC.
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(Exact name of registrant as specified in charter)
TEXAS 0-24526 76-0428727
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
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5718 WESTHEIMER, SUITE 600, HOUSTON, TEXAS 77057
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(Address of Principal executive offices) (Zip Code)
Registrant's telephone number including area code (713) 435-5000
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(Former name or former address, if changed since last report) Not
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applicable
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ITEM 5. OTHER EVENTS.
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Coastal Bancorp, Inc. ("Registrant"), through its subsidiary Coastal Banc ssb,
as Plaintiff ("Coastal") filed a lawsuit in the District Court of Harris County,
Texas on January 12, 2000 against Chase Bank of Texas, N.A. ("Defendant" or
"Chase") seeking to recover for losses incurred as a result of actions or
omissions of the Defendant in connection with the loan described in the
paragraph below.
In November of 1998, Coastal purchased a 40% participation in a $25.0 million
dollar loan that the Defendant had made to Mortgage Corporation of America and
certain related entities ("MCA"). Defendant remained a lead lender on the loan.
As has been widely publicized, MCA filed for receivership in January 1999, and
is currently in bankruptcy. While Coastal has received some reimbursement from
the sale of MCA assets, readily salable assets now appear to have been largely
liquidated. Additional recovery is expected but the timing and amount of such
repayment is uncertain at present.
In light of these circumstances and due to the length of time estimated to
recover either from the lawsuit or the collateral sale, Coastal has determined
it would be in the best interest of its shareholders to completely write off the
MCA asset as of December 31, 1999 and take a $3.5 million, net of tax, charge
against the fourth quarter earnings.
Notwithstanding the filing of this suit, the parties will continue to cooperate
with each other in seeking to identify and sell any available MCA collateral and
to pursue any possible recovery against MCA.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
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EXHIBITS.
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(a) Financial Statements
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No financial statements are required.
(b) Pro Forma Financial Information
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No pro forma financial information is required.
(c) Exhibits
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No exhibit is required.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
COASTAL BANCORP, INC.
/s/ Catherine N. Wylie Date: January 12, 2000
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by: Catherine N. Wylie
Sr. Executive Vice President/
Chief Financial Officer
