A pair of Oregon community banks are out to show the Pacific Northwest how good mergers can work.

Executives at West Coast Bancorp and Commercial Bancorp, two old-line, medium-size independent banks, said last week they want to pioneer the super community bank concept in the region -- with the merger of their two companies as a start.

The idea of a multicharter, local autonomy banking company has often been talked about as a viable alternative to the giant regionals that have been swallowing small banks in the Pacific Northwest in recent years.

In fact, only three relatively small banking companies on the entire West Coast come close to being classic the super community banks seen in the Midwest and in the East.

"What they are trying to do is set up an umbrella company to own many banks," said Jim Bradshaw of Pacific Crest Securities Inc., which helped broker the companies' merger. "They will let the banks operate independently, and banks can get a more liquid stock. Right now, the community bank stocks in this state are mostly traded out of the CEO's desk."

West Coast, based in Newport, and Commerce, in Salem, are billing their marriage as a merger of equals that will create a $420 million, three-bank company.

West Coast chief executive Victor L. Bartruff will be co-chief executive of the combined company with Rodney B. Tibbatts, chief executive of Commerce. They will have different responsibilities, however.

Mr. Bartruff, who spent 26 years running branches for U.S. Bancorp, will be responsible for banking services. Mr. Tibbatts will run the holding company and be responsible for nonbanking services -- meaning finding more banks to buy.

"There are a lot of banks in Oregon that have been approached and bought by larger banks," Mr. Bartruff said. "What they would have preferred to do is remain independent, but because shareholders have liquidity needs the pressure is on to sell.

"What we want to do is give them an opportunity to sell and get that liquidity, but stay autonomous and enjoy what efficiency we can offer as a larger organization."

Oregon has 41 independent community banking companies, almost all of them single-bank holding companies outside the major urban area of Portland.

The majority of the state's community banks have assets of less than $100 million. The merged Commerce Bancorp will be the second-biggest community bank in the state behind Western Bank of Coos Bay.

Washington state, to the north, is much more fertile ground with almost 100 independent small banks, and the vast majority are owned by one-bank holding companies.

"[The multibank] community bank holding company hasn't caught on here probably because the people in this part of the country are really very independent," Mr. Bartruff said.

"And customers have a very good understanding of what community banking is. We think there might be a right way to combine with other banks that would preserve that."

Mr. Bradshaw said the deal at first glance seems unusual because there's not a huge premium involved and there's not much front-end cost savings.

"I think the attractiveness here is the prospect of growth and revenue enhancement in the future," he said. "And the fact that their strategy, if they can implement it, is a good one."

Mr. Tibbatts said that the combined companies will squeeze some cost savings out of consolidating data processing. He added that the two companies, whose banks will retain their respective names, have surprisingly complementary product offerings.

Mr. Bradshaw thinks that there will be banks in Oregon willing to talk merger with Commerce, but Mr. Bartruff said the company hasn't had any concrete discussions yet.

He added that the company shouldn't have to raise capital to buy new banks in the near term, but with its new-found size raising more equity wouldn't be a problem.

"What we want to do right now is step up to bat and show that this kind of merger can be done," Mr. Bartruff said. "Bankers have been talking about this for years here, but we're the first to bring home a transaction."Post-merger Commercial Bancorp at a GlanceHeadquarters Salem, Ore.Assets $420 millionBranches 16Banks 3Co-CEO's Victor L. Bartruff, Rodney B. TibbattsEquity/assets 9%ROA 1.6%

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