First PacTrust Gets Fed OK to Buy Gateway

Banking regulators have finally cleared First PacTrust Bancorp (BANC) to buy Gateway Bancorp.

The Federal Reserve has approved the deal more than a year after it was announced, the $1.3 billion-asset First PacTrust said Thursday. The Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency had previously given it the green light.

The deal is scheduled to close on Aug. 17. First PacTrust has all the approvals it needs from banking regulators and must clear the Justice Department's 15-day waiting period, a First PacTrust spokesman said Friday.

It took longer than expected to get the approvals because regulators had been concerned about Gateway's financial problems, First PacTrust CEO Gregory Mitchell said earlier this summer.

Under an amended purchase agreement, the deal is valued at $15.5 million, or roughly 60% of Gateway's tangible common equity at June 30, instead of $17 million as originally announced in June 2011.

The deal for Gateway in Cerritos, Calif., would be First PacTrust's second to close this year. It completed its acquisition of Beach Business Bank in Manhattan Beach, Calif., in July, about 10 months after announcing the deal.

As a first-time acquirer, First PacTrust in Irvine, Calif., faced a slower approval process for its two transactions compared with veteran dealmakers. The process usually speeds up as buyers become experienced in the process and if the players involved are well capitalized and buying profitable depositories with strong loan portfolios.

For reprint and licensing requests for this article, click here.
M&A Community banking
MORE FROM AMERICAN BANKER