BankAmerica To Sell Off Branches In Arizona
Golden West, Wells, And Norwest May Bid
SAN FRANCISCO -- BankAmerica Corp. has put up for sale 24 Arizona branches with almost $900 million in deposits, as part of the divestiture program needed to complete its merger with Security Pacific Corp.
Among the interested bidders are Golden West Financial Corp., Oakland, Calif.; Norwest Corp., Minneapolis; Wells Fargo & Co., San Francisco; Northern Trust Corp., Chicago; and several private investor groups, banking sources said.
Although BankAmerica apparently wants to complete the sale quickly, it recently extended the deadline for bids beyond the end of this month.
Modest Premium Predicted
A BankAmerica spokeswoman declined to comment on the Arizona branch sales, as did representatives of the potential bidders.
Banking sources estimate the Arizona package will fetch a premium of about 2% to 3% of deposits, or roughly $15 million to $30 million.
Arizona thrift deposits sold by the Resolution Trust Corp. in the past 18 months sometimes commanded premiums well over 4%. However, those involved transactions in which BankAmerica- and Security Pacific were aggressively competing in the bidding.
"If BankAmerica could sell the package to itself, it would make a killing," quipped an Arizona banker.
Some Roots in Arizona
Norwest already owns a three-branch commercial bank in Arizona. Golden West operates a mortgage lending office in the same state, while Wells last year closed a commercial real estate lending office in the Grand Canyon state.
Golden West, parent of World Savings and Loan Association, and Wells Fargo were losing bidders on the failed Arizona thrifts sold by the federal government.
Northern Trust, based in Chicago, is expected to bid on only a handful of branches in selected locations, sources said.
The company owns an Arizona commercial bank with offices in Phoenix, Sun City, and Tucson, which it uses to tap the lucrative private banking and trust markets among the state's large community of retired people. It has no intention of expanding into retail branch banking, Arizona sources said.
In its merger proxy statement released last week, BankAmerica said it intended to sell branches with approximately $4 billion in deposits in Arizona, California, Nevada, Oregon, and Washington, to satisfy regulatory concerns about undue market concentration.
BankAmerica currently operates 110 Arizona branches, a network patched together from a series of RTC purchases. Security Pacific has 103 branches in the state.
In addition, BankAmerica stands to inherit nine branches of Caliber Bank, Phoenix, when it completes its purchase of Caliber's Nevada-based parent, Valley Capital Corp., Las Vegas.
Twelve of the Arizona branches for sale are in Maricopa County, which includes Phoenix. The rest are scattered around the state, according to sources who have seen the bid package. Included in the package are all nine Caliber Bank offices.
As is common in branch sale transactions, no loans are included in the packages. Buyers will receive cash to cover purchased deposits.
Morgan Stanley & Co. is handling BankAmerica's branch sales in Arizona and Washington State.