Commercial Bank of San Francisco has reached an agreement to acquire Lippo Bank California in San Francisco for $15.9 million in cash.
The combined company would have $250 million of assets and branches in San Francisco, Los Angeles, and San Jose. The deal, for 1.56 times Lippo's book value, was unanimously approved by the boards of both banks.
"This transaction enhances our strong market position in trade finance activities and significantly expands our presence in the Asian community," said Robert A. Fuller, chairman and chief executive officer of $167 million-asset Commercial Bank.
The proposed sale would end the 14-year ownership of Lippo Bank by Indonesian investor James T. Riady. Mr. Riady's family controls the Lippo Group, a Jakarta-based conglomerate which made headlines last year with its alleged ties to the Democratic fund-raising scandal.
Lippo's employees are expected to be retained after the acquisition is completed in early 1999. Commercial Bank said it expects to take a one-time charge of $1.4 million.