First PacTrust Bancorp, Inc. (NASDAQ: BANC), the bank holding company for PacTrust Bank and Beach Business Bank, today announced that the U.S. Federal Reserve Bank has approved its acquisition of Gateway Bancorp, the holding company of Cerritos, Calif.-based Gateway Business Bank . This transaction previously was approved by the FDIC pursuant to the guidelines of the Federal Deposit Insurance Act, as well as the Office of the Comptroller of the Currency, and currently is expected to be completed on or about August 17, 2012.
Under the terms of an amended purchase agreement, total consideration for the acquisition will be $15.5 million, or approximately 60% of Gateway’s tangible common equity as of June 30, 2012. Due to Gateway’s profitability during the first half of 2012, management has increased guidance relating to the expected bargain purchase gain to at least $5 million, up from $3 million, which will be reflected in 3Q 2012 earnings.
As part of the acquisition, Mission Hills Mortgage Bankers (a division of Gateway Business Bank), including its 22 loan production offices in California, Arizona, Oregon and Washington, will become a division of PacTrust Bank. During the first half of 2012, Mission Hills Mortgage Bankers originated $490 million in single family residential mortgages.
“We are excited about completing this transaction very shortly and welcome Gateway’s customers to our strong and growing organization,” said Gregory Mitchell, CEO of First PacTrust. “With Gateway and our recently completed acquisition of Beach Business Bank, we will now have 41 bank locations, including the soon to open Newport Beach branch.”First PacTrust plans to merge Gateway Business Bank into PacTrust Bank following the completion of the acquisition. Gateway’s branch operations, located in Lakewood and Laguna Hills, Calif., will be converted to PacTrust Bank branches on or about August 20, 2012.