The Pacific Northwest is once again home to a major community bank merger.

Late Wednesday, Banner Corp. in Walla Walla, Wash., announced it would acquire AmericanWest Bank in a $702 million stock-and-cash deal.

As part of the deal, the $4 billion-asset AmericanWest would merge into the $4.8 billion-asset Banner Bank. Together they would have nearly $10 billion in assets, $6.8 billion in loans and $7.9 billion in deposits, with branches stretching across the entire West Coast.

Banner's president and chief executive, Mark J. Grescovich, is set to lead the combined organization, and five representatives from AmericanWest would join Banner's board, pushing it to 17 members.

"Together, we will have the opportunity to deploy our super-community-bank model throughout a strengthened presence in Washington, Oregon and Idaho and into attractive growth markets in California and Utah," Grescovich said in a press release. "In addition to being a good geographic fit, the combination is anticipated to result in considerable operating synergies."

The deal calls for AmericanWest shareholders to receive 13.23 million shares of Banner and $130 million in cash. The shares would give AmericanWest's owners a 38.8% stake in Banner. The deal is expected to close in the second quarter.

"Merging our two banks is the right step forward because we share similar values and cultures, including the importance of building lasting relationships with our clients and working as a team to deliver seamless solutions that add value for them," Scott A. Kisting, chairman and CEO of AmericanWest Bank, said in the release.

The deal comes just a few weeks after AmericanWest announced it would acquire the $468 million-asset Bank of Sacramento in California for $60 million in cash, its eighth deal since 2011. AmericanWest is owned by SKBHC Holdings, an entity backed with $750 million in private equity that formed in 2010 to acquire AmericanWest from its bankrupt holding company and turn it into a roll-up vehicle.

Banner also has been an active acquirer in the last few years, but with more varied success. It has had two deals in the last year undone by higher bids, but it also got paid by Umpqua Holdings to take some branches (and a top market share) in a coastal county in Oregon that Umpqua had to divest to get an M&A deal approved.

Banner was advised in the transaction with AmericanWest by Sandler O'Neill and Cleary Gottlieb Steen & Hamilton. AmericanWest was advised by Jefferies and Wachtell, Lipton, Rosen & Katz. Skadden, Arps, Slate, Meagher & Flom LLP and Sullivan & Cromwell also advised some of AmericanWest's investors.

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