Consolidation at the lower end of the regional banking market seems to be an early theme in 2018.
Bank of Southern California in San Diego snapped up Glendale-based Americas United Bank for approximately $44 million in cash and stock in a deal announced Feb. 21, and two more deals followed last week.
Ontario-based CVB Financial Corp. agreed to buy Pasadena-based Community Bank for $878 million in cash and stock, the two institutions announced Feb. 26. First Choice Bancorp of Cerritos, the holding company for First Choice Bank, announced the same day the acquisition of the parent company of Pacific Commerce Bank for roughly $110.4 million in stock.
The four banks combined have approximately $13.5 billion in assets under management.
CVB Financial, parent of Citizens Business Bank, has agreed to pay $177.5 million in cash and the equivalent of 30 million shares of CVBF common stock to Community Bank shareholders. Each share of Community Bank common stock would be purchased with 9.46 shares of CVBF common stock, giving Community Bank shareholders collectively a 21 percent stake in CVBF.
Christopher Myers, chief executive of CVB Financial, said in a statement that the Community Bank acquisition would boost the bank’s financial position.
“We are excited to be merging with a successful business bank that has been built customer by customer for the past 74 years,” Myers said. “Our combination with Community Bank provides us tremendous financial opportunity in terms of depth of talent, a strong and diverse customer base, and significant geographic overlap. We have truly admired this franchise for a long time. The reality of blending our two teams is very exciting.”
Community Bank had approximately $3.7 billion in total assets, $2.7 billion in gross loans and $2.9 billion in total deposits as of December 31, 2017. Community has sixteen branch locations throughout Los Angeles and Orange counties.
CVB Financial Corp. is the ninth largest bank holding company headquartered in California with assets of $8.3 billion. Its main subsidiary, Citizens Business Bank, has 51 branches and three trust office locations serving the Inland Empire, Los Angeles, Orange, San Diego, Ventura and Santa Barbara Counties, as well as portions of the Central Valley.
CVBF shares rose 23 cents on Feb. 26 to close at $23.60. Trading in Community Bank shares was halted early, closing unchanged at $186.05.
The First Choice acquisition will give shareholders of the downtown Los Angeles-based Pacific Commerce a fixed ratio of shares of First Choice common stock, based on a 30-trading day average price of $24.83.
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