F&T Financial Services in Porterville, Calif., has agreed to buy Pan American Bank in Los Angeles.
The $122 million-asset F&T did not disclose the price of its all-stock deal for the $38 million-asset Pan American. The deal is expected to close in the next 90 to 120 days, at which point F&T will be liquidated.
F&T and Pan American are Community Development Financial Institutions and designated Minority Depository Institutions that serve low- to moderate-income consumers and businesses. Both are focused on the Hispanic community.
Robert Hughes, F&T's president and chief executive, will have the same posts at the company, which will adopt the Pan American name. He will succeed Robb Evans, who has been Pan American's interim chief executive since it was recapitalized by a group of community banks last July.
Pan American was significantly undercapitalized before the recapitalization. It was also facing potential failure after another capital raise fell through, Timothy Chrisman, principal of executive the search firm Chrisman & Co. in Los Angeles, said last summer. Chrisman worked with John Eggemeyer, managing principal at Castle Creek Capital, a bank-focused hedge fund in Rancho Santa Fe, Calif., to connect Pan American with other banks.
Pan American is planning to open a branch later this year in the north San Fernando Valley, which is part of a broader plan to expand into select Los Angeles markets with significant Hispanic and low- to moderate-income consumers.
F&T is advised by MJ Capital Partners and Manatt, Phelps & Phillips. Pan American was advised by Horgan, Rosen, Beckham & Coren.