BREA, Calif. -- Unionfed Financial Corp. said its registration statement for a proposed rights offering has been declared effective by the Securities and Exchange Commission.

The company is seeking to raise. at least $37.5 million in an offering to investors, directors executive officers, and shareholders to comply with a regulatory order to boost its capital. That directive requires the bank to achieve 4% leverage, 4% Tier 1 risk-based capital, and 8% total risk-based capital ratios by Sept. 23.

The company also said the Office of Thrift Supervision approved its sale of branches with about $180 million of deposits to California Federal Bank. The branch sale is part of an OTS-approved capital restoration plan and is expected to be closed no later than Friday, the company said.

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