The Federal Reserve recently approved a merger between Banc
of California, Inc. and PacWest Bancorp and their respective bank subsidiaries,
Banc of California, N.A. and Pacific Western Bank. The California Department of
Financial Protection and Innovation (DFPI) approved Banc of California’s
acquisition of Pacific Western for $1.1 billion in early October.
With the Fed’s approval obtained, the proposed merger can
proceed without further regulatory action. The transaction is expected to close
before the end of the year, provided all parties involved fulfill the remaining
closing conditions detailed in the merger agreement, including the receipt of
the requisite stockholder approvals.
“We are very pleased to have received regulatory approval at
this time,” Banc of California Chairman, President and CEO Jared Wolf said in a
press release. “We appreciate the active engagement and focused efforts of the
Federal Reserve and the California DFPI to review and approve this merger which
will be beneficial not only for our clients, communities and shareholders, but
also for the broader regional banking industry.”
PacWest saw a 21 percent dip in stock value in the wake of
the March financial crisis, which resulted in the failures of three mid-sized
banks – Silvergate, Signature and Silicon Valley Bank. With the acquisition of PacWest’s
$9.7 billion in assets, Banc of California will hold approximately $25.3
billion in loans and $30.5 billion in deposits.
“We are excited to be bringing Banc of California and
Pacific Western Bank together and unlock the strength of our combined platform
to create a robust, well-capitalized and highly liquid institution,” Wolf said.
“As a leading relationship-focused business bank, we will continue to serve a
wide range of clients and deliver exceptional service, increased scale, and
expanded product offerings.”
The combined institution is expected to become the
third-largest in the state of California, operating more than 70 branches in the
state, as well as branches in North Carolina and Colorado.