Commercial lender CapitalSource won't buy TierOne because of ongoing problems in the credit market and regulatory delays.
Falling stock prices had diminished the value of the deal from $652 million when it was announced last May to roughly $423 million Thursday, based on stock prices.
TierOne Corporation, the Nebraska-based parent of TierOne Bank, and CapitalSource Inc. both said the deal was off after the markets closed Thursday.
Last month, TierOne said it was still committed to the deal even though it had the right to terminate without penalty after February 17th.
The Lincoln-based company also announce it would buy back 10 percent, or 1.8 million shares of common stock.
CapitalSource is based in Chevy Chase, Md.
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On the Net:
CapitalSource Inc.: http://www.capitalsource.com
TierOne Corp.: http://www.tieronebank.com
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