Ontario-based CVB Financial Corp., the parent of Citizens Business Bank and a major player in Los Angeles County, has agreed to pay $204 million in stock and cash for a bank in California’s Central Valley.

The acquisition marked the second bank consolidation in the Central Valley region by a California bank in late July.
CVB’s combination with Visalia-based Suncrest Bank will increase the company’s total assets to about $17 billion.
 
David Brager, chief executive of CVB Financial, said the Suncrest purchase is his bank’s second-largest acquisition.
 
He described the Central Valley as “a sizable and important new market for Citizens Business Bank that presents significant growth opportunities going forward.”
Although CVB Financial is based in San Bernardino County, 21 of the company’s 58 branches are located in L.A. County. And 42%, or $3.4 billion, of its total outstanding loans are made in L.A.
 
The bank also said that about 42.4%, or $5.6 billion, of its $13.2 billion in total deposits, comes from L.A.
The transaction deepens CVB Financial’s presence in California’s breadbasket region and expands the bank’s footprint to as far north as West Sacramento.

In an interview, Brager said CVB Financial’s strategy is to stay focused on acquisitions in California, where it is listed as the ninth-largest commercial bank headquartered in the state.
“Our strategy is to remain independent at this point and grow the bank in a measured way,” Brager said.

Suncrest Bank adds about $1.3 billion in total assets to Citizens’ balance sheet, as well as $900 million in outstanding loans and $1.2 billion in deposits as of March 31.
Suncrest has seven branch locations and two loan production offices throughout California’s Central Valley.

The transaction is expected to close in the fourth quarter of 2021 or first quarter of 2022.
In a July investor presentation, CVB Financial outlined several areas of growth opportunities, including through acquisition, organic growth within its existing network of 58 branches and starting-from-scratch bank branches in new markets.
CVB Financial has stated as recently as July in filings with the Securities and Exchange Commission that it was looking to buy California banks with $1 billion to $8 billion in assets.
 
The bank has made a steady stream of acquisitions in the past seven years.
CVB Financial paid $903 million for Pasadena-based Community Bank in 2018, its biggest acquisition.  

It also paid $70.3 million for Visalia-based Valley Commerce Bancorp., parent of Valley Business Bank in 2017; $41.3 million for Oxnard-based County Commerce Bank in 2016; and $57 million for Newport Beach-based American Bancshares Inc., parent of American Security Bank, in 2014.
 
In its second quarter ended June 30, CVB Financial reported $51.2 million in profit versus $41.6 million in the same year-ago period.

“As a proven acquirer, we have been expecting the bank to reenter the M&A arena for some time, where it’s first announced acquisition in the past three years is the second largest in its history and checks all the boxes it has previously laid out,” wrote David Feaster, banking analyst with Raymond James & Associates Inc., in a research note.
“It deepens its presence in growth markets and fills in the northern part of its footprint nicely, notably expanding into Sacramento but also deepening its existing footprint in Visalia and Fresno,” he added.
 
The cultural fit also aligns well, given Citizens Business Bank’s and Suncrest’s “agricultural expertise,” according to Feaster.  

Citizens Business Bank also recently hired a new president, Brian Mauntel, who will be responsible for overseeing the bank’s 57 branches, wealth management division and its specialty lending groups, including dairy and livestock and agribusiness.