Advanta to liquidate its assets

It seems the end is near for Advanta Corp., the bankrupt Montgomery County credit-card firm with a history of reinvention after financial wipe outs.

The Spring House company said yesterday that its board voted to liquidate assets, with the expectation that nothing would be left for preferred or common stockholders.

By contrast, when Advanta filed for Chapter 11 bankruptcy protection in November, it said it was "reviewing both existing and potential business opportunities in connection with the reorganization."

In May, after Advanta decided to freeze its customers' credit cards, chairman and chief executive Dennis Alter said he wanted to give the company "a chance to fight again and be a vibrant and worthwhile business endeavor."

Under Alter's leadership since the early 1970s, Advanta shifted its focus from its original business of making installment loans to teachers to consumer credit cards, then to subprime mortgages, and then to small-business credit cards, growing aggressively each time and having to reinvent itself amid losses.

Tom Becker, a spokesman for Advanta, said the company had no comment beyond its news release and a Securities and Exchange Commission filing.

Last week, lawyers involved in Advanta's bankruptcy agreed to postpone a hearing at which the company was seeking approval of its nearly $1 million monthly payroll. That averaged $268,000 for each of the remaining employees, who had no operation to run.

What remains unknown is how much money will be left for 3,800 individual Advanta noteholders, who were owed $138 million in November, when the company had less $100 million in cash and equivalents. The company said yesterday it expected to establish a liquidating trust to handle certain assets.

Advanta Bank Corp. of Utah, the entity that issued Advanta credit cards but was not included in the bankruptcy, is operating under a restrictive agreement with the Federal Deposit Insurance Corp. to return deposits to customers.