United Security Bancorp. has agreed to buy Wheatland Bank, Davenport, Wash., for about $12.5 million in stock.
The $69 million-asset bank would retain its name and become the third subsidiary of $235 million-asset United Security.
Combined with the pending acquisition of five Wells Fargo & Co. branches in central and eastern Washington, which was announced in March, the Wheatland purchase would double the number of United Security branches, from 10.
Wheatland, which has five branches west and south of Spokane, focuses on agricultural lending in an area dominated by wheat and barley fields, with some cattle operations.
The United Security Bank unit is in seven eastern Washington communities, and Home Security Bank, the second subsidiary, has three branches in the Yakima area.
United Security officials said they hope the acquisition will boost operating efficiency and loan growth.
"We think it'll be another step in the direction we're trying to go, to be a major player in eastern and central Washington," said United Security president and chief executive officer William C. Dashiell.
The merger, which is subject to regulatory approval, is expected to be completed in the third quarter. The Wells branch purchases are expected to close in July.