In order to fortify its existing Homeowners Association (HOA) banking services,
PacWest Bancorp ( PACW Quick Quote PACW - Free Report) recently announced that its banking subsidiary, Pacific Western Bank, has signed an all-cash deal worth $250 million to acquire MUFG Union Bank, N.A.’s HOA Services Division. The transaction is likely to close in the fourth quarter of 2021, subject to necessary approvals. Shares of PacWest have gained 2.8% following the deal announcement on Apr 1, before markets opened.
With about $4 billion in deposits, MUFG Union Bank’s HOA Services Division garners a full array of banking services to community management companies and its homeowners’ associations.
Per the terms of the deal, Pacific Western will acquire certain assets and liabilities of the HOA Services Division for a premium of 5.9% on deposits added by the net book values of certain presumed assets and liabilities for $250 million. However, the final value will be on grounds of the closing balances.
Additionally, the existing management and employees of the HOA Services Division will join Pacific Western.
With this acquisition, Pacific Western seeks to augment its strategy of product expansion and diversification of sales and funding sources, apart from an amplification in its existing practices of providing lockbox, electronic receivables processing and other financial services to HOA management firms.
The president and CEO of PacWest, Matt Wagner, said, “This HOA business, under the continuing leadership of Kimberly Siebler and her team, will provide Pacific Western Bank with what we believe is a robust HOA banking services technology platform and an experienced and accomplished team in an important niche market segment.”
Shares of PacWest have gained 107.3% over the past six months compared with the
industry’s rally of 66.4%.
Currently, the company carries a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here . Similar Moves by Peers
Continuing with its efforts to strengthen its consumer banking business,
The Goldman Sachs Group, Inc. ( GS Quick Quote GS - Free Report) is planning to take over JetBlue Airways Corp.’s credit card program. According to a report by the Wall Street Journal in the earlier month, citing people familiar with the matter, the company is in talks with JetBlue Airways Corp. for the deal.
This January 2021,
U.S. Bancorp ( USB Quick Quote USB - Free Report) agreed to acquire the debt servicing and securities custody services client portfolio of MUFG Union Bank, N.A as part of its efforts to increase presence on the West Coast.
JPMorgan Chase & Co. ( JPM Quick Quote JPM - Free Report) acquired the Global Loyalty division of cxLoyalty Group Holdings, which is anticipated to accelerate its solid foundation built on loyalty, including JPMorgan’s Ultimate Rewards platform. Zacks Top 10 Stocks for 2021
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