FirstBank in Lakewood, Colo., has announced plans to acquire a branch in Palm Desert, Calif., from El Paseo Bank.
The deal for the branch, located in a retail strip center, includes $66 million in deposits and the lease of the 4,000 square-foot space.
FirstBank currently operates a branch across the street, which will be consolidated in November into the branch it is acquiring from the $171 million-asset El Paseo.
"The new location will give FirstBank more visibility among area residents," Brian Holcombe, FirstBank's California market president, said in a press release Tuesday.
The $13 billion-asset FirstBank entered the Palm Desert market in 1985 and has five locations, which had $273.7 million in deposits at the end of the second quarter, up nearly 3% from a year earlier. Loans in that market totaled $251.9 million, up 23.2%.
On its home turf in Colorado, FirstBank has been tinkering with its deposit business. Last year it announced it would close 15 branches, mostly those located in supermarkets, in response to changing customer banking habits.
The companies didn't disclose the price FirstBank would pay El Paseo, which appears to be hurting for capital. At the end of the second quarter, El Paseo which is chartered as Frontier Bank was significantly undercapitalized, with a leverage ratio of 2.36%. It will continue to operate two other branches.
"El Paseo Bank remains committed to the Coachella Valley market with its two remaining branches in Palm Desert and Rancho Mirage," James Hicken, chief executive of El Paseo, said in the release. "The sale of the branch represents an important initiative as we consolidate our platform to better serve our community."