BBCN Bancorp (BBCN) in Los Angeles has agreed to buy Pacific International Bancorp (PIBW) in Seattle.
The transaction, which comes less than a year after a merger of two large Korean-American banks created the $5 billion-asset BBCN, values Pacific International at $8.2 million. As part of the deal, BBCN would repay the $6.5 million in preferred stock that Pacific International issued to the Treasury Department under the Troubled Asset Relief Program.
Buying the $209 million-asset Pacific International would position BBCN as "major player in the Pacific Northwest Korean-American community," Alvin Kang, BBCN's president and chief executive, said in a late Monday press release. Pacific International is the largest Korean-American bank based in the Pacific Northwest; it focuses on small-business banking, according to a research note from Sandler O'Neill & Partners.
The deal, which is expected to close during the first quarter of 2013, would triple BBCN's branches around Seattle to six. BBCN was advised by the law firm of Mayer Brown and was provided with a fairness opinion by Raymond James. Pacific International was advised by KBW's Keefe, Bruyette & Woods and the law firm of Graham & Dunn.
BBCN was formed after Center Financial and Nara Bancorp merged late last fall, creating the largest Korean-American-owned bank in the United States. It has more than 40 branches in California, New York, New Jersey, Washington and Illinois.
BBCN also reported on Monday that its third-quarter earnings more than doubled from a year earlier, to $18.4 million. Loans grew at a 23% annualized pace, with balances rising to roughly $4.1 billion, Sandler O'Neill said. Most of the gains were in commercial real estate, though the company also made more commercial and industrial loans.