LA’s Pacific Commerce Bank buys lender ProAmérica

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The Pacific Commerce Bank in downtown Los Angeles has announced plans to buy another downtown lender, ProAmérica Bank, a deal that marks continued expansion for a bank and the end of a short difficult period for the bank. ‘other.

Pacific Commerce, founded in Little Tokyo in 2002, plans to acquire ProAmérica for $ 29.8 million in cash and stock. The deal, which must be approved by regulators and bank shareholders, would be Pacific Commerce’s second recent acquisition. Earlier this year, he completed his purchase from the small lender Chula Vista Vibra Bank.

By acquiring Vibra and now ProAmérica, Pacific Commerce would more than double in size in just over a year, allowing it to expand its presence and offer larger loans to small and medium business customers.

For ProAmérica, the acquisition would end a difficult task.

The lender, focused on Latino clients, had large backers – including billionaire real estate mogul Ed Roski, who remains on the bank’s board, and former president Maria Contreras-Sweet, who now heads the Federal Small Business Administration – but it was founded at a bad time for banking.

It opened at the end of 2006, just two years before the financial crisis and the recession that followed. This unfortunate moment made it difficult for the bank to grow enough to remain a stand-alone entity, said Sal Varela, Interim President and CEO of ProAmérica.

“We’ve been around for eight or nine years, but four or five of them have been extremely difficult,” he said. “We grew, but not at the speed we wanted. “

ProAmérica has assets of just $ 211 million, which is minimal by banking standards. Such a small balance sheet prevents it from offering loans greater than about $ 6 million, Varela said.

Together, Pacific Commerce and ProAmérica would have assets of around $ 560 million, which would allow it to grant loans between $ 10 million and $ 20 million, he said.

The acquisition is expected to be finalized this spring.


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