Continuing its expansion in Southern California, Western Bancorp said it has a deal to buy Peninsula Bank of San Diego for $114 million of stock.

Western, parent of Santa Monica Bank and Southern California Bank, said it would pay Peninsula shareholders $45.75 for each share they own. The deal, equal to 4.17 times Peninsula's book value, would expand Western's reach into southern San Diego County and boost assets to about $2.7 billion.

"Peninsula Bank is the premier community banking franchise in San Diego County," said Matthew P. Wagner, Western's president and chief executive officer.

John G. Rebelo Jr., chairman and chief executive officer of $428 million-asset Peninsula, said his bank was not seeking a merger partner but found it difficult to turn down Western's offer. Like Western's other subsidiaries, Peninsula would operate independently, retaining its name and management team. The deal is expected to close in late 1998 or early 1999.

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