First California, Premier Service Bank Call Off Merger

The long-delayed merger between First California Financial Group (FCAL) and Premier Service Bank (PSBK) has been called off. 

The companies said late Wednesday that they had cancelled the combination because it did not close by the Dec. 31 deadline established under the terms of the merger.  Neither bank immediately responded to American Banker's requests for comment.

First California, which is based in Westlake Village, agreed to buy Premier, based in Riverside, Calif., last February 2012.  In the 11 months since the deal was announced, the banks have revised the terms of sale, and First California has agreed to sell to PacWest Bancorp (PACW).

The banks initially expected the $2 million stock transaction to close by the third quarter of 2012. In July, the $1.9 billion-asset First California reduced the number of shares it would pay to buy the $138 million-asset Premier by 38%, attributing the change to the fact that the buyer's share price had risen.

In November, First California agreed to sell itself to PacWest Bancorp (PACW) for $231 million, after months of aggressive pursuit by the Los Angeles bank.

Premier Service's financial performance has improved since the deal was announced. The bank said Thursday that it enjoyed its second straight profitable quarter, earning $347,000, or 27 cents a share, in the fourth quarter. The bank lost $820,000 a year earlier.

First California has not yet released its fourth-quarter earnings.