Under terms of the transaction, PacWest’s $29 billion-in-asset Pacific Western Bank will purchase MUFG Union Bank’s homeowners association services division, which provides a full range of banking services to community management companies and their homeowners associations.
An HOA is an organization in a subdivision, planned community or condominium building that makes and enforces rules for the properties and its residents. Those who purchase property within an HOA's jurisdiction automatically become members and are required to pay dues, known as HOA fees.
The acquisition will significantly expand PacWest's existing HOA banking practice, which provides lockbox, electronic receivables processing and other financial services to HOA management companies.
PacWest President and Chief Executive Matt Wagner said in a prepared statement that the acquisition will “significantly enhance his institution’s position catering to the specialized banking needs of community management companies and the HOA clients they serve.”
PacWest’s Kimberly Siebler will continue to run the homeowners banking services unit after it changes hands.
Union Bank’s homeowners services unit oversees $4 billion in deposits. The existing management team and employees will transition to PacWest in connection with the close of the acquisition, which is expected to occur in 2021's fourth quarter.
PacWest said it will pay a premium of 5.9% on deposits plus the net book values of certain assumed assets and liabilities.
The final consideration will be based on balances at closing and subject to regulatory approvals.