New deal also lets bank negotiate privately with directors, officers, other investors

authors Geert De Lombaerde

The directors of CapStar Financial Holdings late last week approved an $8.8 million expansion of the bank holding company’s share buyback plan.

The move comes after the downtown-based lender has repurchased $5.8 million of the $8 million worth of stock its board authorized late last year. If carried out at current prices, the newly approved buyback will let CapStar executives buy back about 570,000 shares — a little more than 3 percent of 11-year-old CapStar’s outstanding stock.

CapStar will buy back its shares with a combination of cash on hand and cash generated from operations. The company also has the option now of privately negotiating purchases with its directors, officers and other shareholders.

Word of CapStar’s larger buyback plan comes about a month after its leaders said they foresee slower loan growth ahead as they rein in their loan exposure beyond Middle Tennessee and as some commercial real estate customers pay off their loans. Shares of the company (Ticker: CSTR) closed Friday at $15.43, up slightly on the day. Over the past six months, they have slipped a few percentage points.

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