PacWest Bancorp (Nasdaq: PACW)
jointly announced today that PacWest’s wholly-owned subsidiary, Pacific Western Bank, and Opus Bank have entered into a definitive agreement whereby Pacific Western Bank will sell 10 branches to Opus Bank. The branches to be sold are located in the cities of:
- Encino, Los Angeles (Westwood), Monrovia and South Pasadena, located in Los Angeles County, California;
- Chino and Twentynine Palms, located in San Bernardino County, California;
- La Quinta, located in Riverside County, California; and
- Carlsbad, El Cajon and La Mesa, located in San Diego County, California.
The transaction will result in the transfer of deposits to Opus Bank in exchange for a blended deposit premium of 2.5% applied to the deposit balances transferred at closing. Currently, the deposits of the offices to be sold total approximately $145 million. Although certain other immaterial assets related to the branches will be included in the transaction, no loans will be transferred. The transaction is expected to be completed before the end of the year subject to regulatory approval and other customary terms.
Matt Wagner, CEO of PacWest Bancorp, stated “The sale of these branches is part of our ongoing effort to improve our overall efficiency and profitability. Although the sale of these branches will not result in any material gain, the annual cost savings, representing noninterest expense less noninterest income, have been estimated to be $2.0 million after tax.”
Mr. Wagner continued, “Between now and the closing date, the PacWest and Opus teams will work closely with each other to assure a smooth transition for customers, communities and employees.”
Stephen H. Gordon, Chairman and Chief Executive Officer of Opus Bank commented, “This transaction represents an important step in Opus Bank’s strategic plan to expand into all the major metropolitan areas up and down the West Coast. The acquisition of these banking offices is consistent with Opus Bank’s long-term plan to build a relationship-based, super-community bank, providing high quality banking products, services, and solutions to its clients.” Mr. Gordon added, “The new client deposit relationships, bankers, and banking offices provide Opus Bank the opportunity to further expand its presence through Southern California by complementing its existing 23 banking offices in Los Angeles, Orange, and San Diego Counties, while additionally creating Opus Bank’s initial presence in Riverside and San Bernardino Counties. By further expanding our footprint, Opus Bank will be better positioned to fulfill our mission of financially backing businesses, entrepreneurs, real estate investors, professionals, and consumers, as they expand and grow.” Mr. Gordon concluded, “We look forward to welcoming our new bankers and clients, building upon these existing relationships, and further financing growth within our communities.”