by Paula Peterson,

asst to editor

There are some complicated issues concerning the Quartz Mountain Aerospace / Luscombe Aircraft Corporation (QMA / LAC) online auction that took place on Tuesday, May 4. Some readers have been wondering why the Federal Deposit Insurance Corporation bid on the Luscombe 11E Type Certificate (TC). QMA borrowed from the former First State Bank, and when they were taken over by the FDIC in March 2009, those QMA debts were passed on to FDIC, representing the taxpayers. To help pay back the debt to the people, the FDIC bid on the TC. Now the FDIC has some tangible goods to help pay the debt. John Daniel, former CEO of QMA/LAC said that he will try to be of assistance to the FDIC to try to find a buyer for the TC.

In an effort to explain the QMA, and the former First State Bank connection, there may been some confusion for newcomers over the new First State Bank of Altus, a branch of the Herring Bank of Amarillo, Texas, and the former First State Bank (FSB). It is the former First State Bank that made loans to QMA/LAC, and at one point actually made QMA a subsidiary of the former FSB. According to First State Bank of Altus President Larry McLaughlin, their bank has no liabilities or any association with any subsidiaries of the former bank.

For newcomers to the area, from the January 1, 2010 "Stories that made the headlines" in the Altus Times, Managing Editor, Michael Bush wrote, "Citing hazardous lending, inadequate capital and earnings, and an excessive level of bad loans, the (former) First State Bank in Altus was placed under state and federal supervision. The bank was later shut down by regulators and later reopened under Herring Bank of Amarillo, Texas, who assumed all of the deposits of First State Bank of Altus. They kept the name First State Bank of Altus and named longtime Altus banker Larry McLaughlin as the branch President."

McLaughlin said that Herring Bank was established in 1899. It has been serving SW Oklahoma and Northern Texas under the same management all those years. First State Bank of Altus has retained many of the loyal long term employees, and prides themselves in being a community bank, a Herring Bank with a strong capital structure.

In regard to those who are asking when the proceeds may be distributed from the QMA auctions, Loyd said, "The process is lengthy and time consuming and can (take) a number of months to complete." Loyd also reiterated "I have to do things based on timing and notice requirements dictated by the U.S. Bankruptcy Code.  I will use best efforts to get this done as quickly as the Code allows." For the steps the trustee must accomplish see Liquidation of the QMA assets.