City National Corp. has announced that its wholly owned subsidiary, City National Bank, has acquired the banking operations of La Jolla, Calif.-based Imperial Capital Bank in a purchase and assumption agreement with the Federal Deposit Insurance Corporation (FDIC).
City National will acquire approximately $3.4 billion in assets and approximately $2.2 billion of deposits, including $500 million of core deposits, as of Sept. 30. Imperial Capital Bank's $2.6 billion in loans will be subject to a loss-sharing agreement with the FDIC. City National expects the acquisition to be immediately accretive to earnings per share.
"Imperial Capital Bank is a very good fit for City National, given that eight of its nine locations are in communities we serve," said Chief Executive Officer Russell Goldsmith. "When we complete the integration, Imperial Capital's clients will benefit from the much greater capabilities and services of City National, and the clients of City National will enjoy the added convenience of an expanded branch network. In addition, we're pleased to contribute to the increased stability of the banking system with an acquisition that will enable City National to become a somewhat larger and more efficient and profitable company."
The acquisition follows a decision by the California Department of Financial Institutions to close Imperial Capital and appoint the FDIC as receiver. Imperial Capital's $2.2 billion of deposits include $500 million in core deposits and $1.7 billion in certificates of deposit.
Its assets include $2.6 billion in loans, which consist of approximately $1.6 billion in multi-family residential loans, $600 million in commercial real estate and commercial and industrial loans, and $400 million in construction loans.
Imperial Capital Bank's nine branches , including one in Beverly Hills, will reopen for normal business hours on Monday. They will continue to operate under Imperial Capital's name until the company's systems are merged with those of City National Bank in the first half of 2010. Until then, Imperial Capital's clients should use the same branches they currently do, the company said.
The take over of Imperial Capital Bank was one of seven financial institutions that were seized and sold off by the FDIC on Friday. Imperial Capital Bank's failure was expected to cost the FDIC $2.5 billion.
