A planned merger between two southern California banks has yet to close a year after the deal was announced because regulators have yet to approve it.
First Foundation Bank in Irvine announced in June 2011 that it was buying the $147 million-asset Desert Commercial Bank in Palm Desert for about $16 million in stock. Desert Commercial shareholders could receive an additional $4 million two years down the road if certain loans perform well.
The deal would be the first ever for the five-year-old First Foundation, which has $678 million of assets and three branches in Orange, Riverside and Los Angeles counties.
In a news release Thursday, the companies said that they have extended the deadline for terminating the deal from June 30 to Aug. 15. They have also agreed to push back the planned registration of First Foundation's shares by six months, to Oct. 31, 2013.
Scott Kavanaugh, First Foundation's chief executive, said that extending the termination deadline will give regulators more time to review the merger application.
"Changes in the regulatory environment brought about by the Dodd-Frank Act have led to unexpected delays in the regulatory approval process," he said.
Shareholders of both banks have approved the deal, though Desert Commercial's investors will need to vote again on the plan to push back the date for registering First Foundation's shares.