United Western Bancorp's case converted at U.S. Trustee's request

By Caroline Salls

Pittsburgh, April 15 - United Western Bancorp, Inc.'s Chapter 11 bankruptcy case was converted to Chapter 7 on April 15 by the U.S. Bankruptcy Court for the District of Colorado.

As previously reported, U.S. Trustee Robert A. Wieland asked the court to convert the case or dismiss it if it was not converted.

Consistent with their status as non-operating entities, Wieland said the United Western debtors' monthly operating reports reveal that none of the debtors have earned any income of any type since they filed for bankruptcy, other than "very nominal income" for Matrix Funding Corp.

Meanwhile, Wieland said, significant expenses have accrued.

In addition, he said that the debtors have no reasonable likelihood of rehabilitation and the company "is depleting estate funds at a staggering rate."

Wieland said conversion would allow an independent fiduciary to determine whether litigation against the federal government is in the best interests of creditors and whether current executive compensation is appropriate.

United Western is the holding company for a Denver community-based bank. The company filed for bankruptcy on March 2, 2012 under Chapter 11 case number 12-13815.

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