Great Western Bank, Beverly Hills, Calif., has signed a letter of intent to swap its 14 thrift branches in Washington State for 10 Southern California branches of Seattle-based Pacific First Bank.
Great Western, a unit of Great Western Financial Corp., would acquire about $445 million in deposits, and Pacific First would get some $385 million in deposits. Neither party would pay a premium, and no loans would be exchanged, a Great Western spokesman said.
The Pacific First branches are scattered in four Southern California counties. Great Western's Washington offices are all in the Seattle area. The deal is subject to completion of a definitive agreement and regulatory approvals.
Pacific First's Canadian parent, Royal Trustco Ltd., Toronto, has said it is trying to sell its U.S. thrift, part of a worldwide retrenchment after steep loan losses in Europe and North America.
Analysts said the branch exchange would make Pacific First, with $6.9 billion in assets, more attractive to buyers by concentrating its operations in Washington and Oregon.
For its part, Great Western said it is giving up branch banking in Washington because its franchise is too small to be competitive. It entered the state in 1988.
Lending Activity to Continue
The thrift will continue mortgage lending in the Evergreen State and may open additional loan-origination offices, a company spokesman said.
Meanwhile, Washington sources said that Glenfed Inc., Glendale, Calif., is considering selling its Seattle-based University Savings Bank unit, which has about $1 billion is assets. Glenfed has declined to comment.