City National Bank didn’t stay No. 2 for long.
The Los Angeles institution, which had been the largest bank by assets in Southern California until rival East West Bank knocked it from its perch with an acquisition last month, has regained its status as the largest local bank by acquiring the assets of Imperial Capital Bank, a La Jolla institution closed by regulators late Friday. (Imperial Capital Bank has no affiliation with Imperial Capital LLC, an investment bank in Century City.)
Through the deal, City National acquired $3.4 billion of Imperial Capital’s assets, including nine offices that will reopen Monday as branches of City National. City National said it bought $2.6 billion in loans, including $1.6 billion in multi-family residential loans and $600 million in commercial real estate. Additionally, the bank paid a 0.24 percent premium for the right to assume $2.2 billion of Imperial Capital’s deposits.
“Imperial Capital Bank is a very good fit for City National, given that eight of its nine locations are in communities we serve,” said Russell Goldsmith, chief executive of City National, in a statement. “When we complete the integration, Imperial Capital’s clients will benefit from the much greater capabilities and services of City National, and the clients of City National will enjoy the added convenience of an expanded branch network.”
Following the California Department of Financial Institution’s closure of Imperial Capital, the bank’s assets were transferred to the Federal Deposit Insurance Corp., which entered into a purchase and assumption agreement with City National. Imperial Capital was the 139th federally-insured institution to fail in 2009. First Federal Bank of California was shuttered later in the evening.
City National, owned by City National Corp., had $18 billion in assets as of Sept. 30. The institution had been the largest bank in Southern California for years, but was dethroned recently by East West, which boosted its assets to more than $19 billion with the acquisition of United Commercial Bank, a San Francisco bank that failed Nov. 6.
But with the acquisition Friday, City National’s assets exceed $21 billion, making City National the biggest again.
However, City National apparently is not the biggest depository institution in Los Angeles County. That title belongs to OneWest Bank, a savings association based in Pasadena. It bought the assets of FirstFed Financial Corp., which failed Friday. That gives OneWest assets exceeding $24 billion.
City National shares on Monday closed up $6.23, or 15 percent, to $47.32 on the New York Stock Exchange.