Pelican Seeks to Spin Off Mortgage Sub

Pelican Financial Inc., Ann Arbor, Mich., has announced that its board of directors will seek regulatory approval to spin off its wholesale mortgage banking subsidiary, Washtenaw Mortgage Co.Under the proposal, Washtenaw would become a wholly owned subsidiary of a new public company, The Washtenaw Group, and Pelican stockholders would receive identical holdings in the mortgage company, Pelican said. Meanwhile, Pelican Financial would continue as the bank holding company for Pelican National Bank, a community bank based in Naples, Fla. Pelican said it does not expect to make management or "significant" operational changes as a result of the proposal. Explaining the rationale for the proposal, Pelican chairman Charles C. Huffman said "it would appear that the capital markets, using traditional valuation techniques, will place a higher value on the bank and mortgage company as separate companies than as one diversified financial organization, thus enhancing the ability to raise capital to expand operations of each company separately."