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COSTA MESA, Calif., Dec. 11, 2013 (GLOBE NEWSWIRE) -- Pacific Mercantile Bank, a wholly-owned subsidiary of Pacific Mercantile Bancorp (Nasdaq:PMBC), today announced that its Board of Directors has determined the Bank will exit the consumer mortgage origination business and terminate operations of its Mortgage Banking Division. The Bank expects to sell or terminate substantially all business activities of its consumer mortgage origination unit (previously reported as its Mortgage Banking segment).
"We made the strategic decision to exit the consumer mortgage origination business due to the operating performance of the unit and the Bank's desire to focus on continuing to develop the commercial banking opportunity in its marketplace," said Steven K. Buster, President & CEO of Pacific Mercantile Bancorp and Bank. "We believe that this change will support our mission of becoming a prominent Southern California business banking franchise."
Management anticipates that the Bank's consumer mortgage origination business will cease accepting new applications on or about December 20, 2013, if not sold prior to that date, and terminate all operations on or about April 30, 2014. The Bank will continue to serve the needs of mortgage customers with loans that are in process on December 20, 2013. "We fully understand the importance of ensuring that our customers are provided with the same level of excellent customer service that we have provided in the past," Gary Braunstein, Executive Vice President of the Bank's Mortgage Banking Division said.
The Bank will honor all contractual commitments for mortgage loans that are in process as of December 20, 2013. Management expects the majority of those loans will close in 75 days. The Bank expects to incur approximately $3.3 to $3.8 million, after tax, in costs related to exiting the business.
About Pacific Mercantile Bancorp
Pacific Mercantile Bancorp is the parent holding company of Pacific Mercantile Bank, which opened for business March 1, 1999. The Bank, which is an FDIC insured, California state-chartered bank and a member of the Federal Reserve System, provides a wide range of commercial banking services to businesses, business professionals and individual clients through its combination of traditional banking financial centers and comprehensive, sophisticated electronic banking services.