Beverly Hills Bancorp Inc. in Calabasas, Calif., said Tuesday that it has a deal to replenish its capital.
Orchard First Source Asset Management LLC would take an 80% stake in Beverly Hills Bancorp, and Orchard's lending unit, OFS Funding LLC, would be merged into First Bank of Beverly Hills. The price was not disclosed.
The deal would add "substantial" capital to the $1.5 billion-asset bank, causing it to become well capitalized again and satisfying a cease-and-desist order regulators issued Feb. 13, Beverly Hills Bancorp said.
This is the first step in a broader recapitalization and growth plan, the company said; the bank would shift from a wholesale model to a more traditional banking one, with an emphasis on increasing core deposits. The asset portfolio, which had been concentrated in real estate loans and securities, would become more conventional and diversified, the company said.
The deal is to close in the second or third quarter.