California's First Community Strikes Again

Article excerpt

The buying spree continued this week for First Community Bancorp of Rancho Santa Fe, Calif., with a deal that would push it past $2 billion of assets.

Late Monday the company said it had agreed to buy $714 million-asset First National Bank of San Diego for $142.4 million in cash and stock transaction -- about 2.76 times book value.

"I think this is a great opportunity to create a large community bank serving the business sector," chairman John M. Eggemeyer said Tuesday.

Industry sources said he seems to be building up First Community as a takeover target.

The sale is expected to close in the third quarter. The buyer's Rancho Santa Fe National Bank would be merged into the better-established First National. Both are in San Diego County.

Matthew Wagner, First Community's president and chief executive officer, said the opportunity to buy the largest remaining independent bank in the county was "irreplaceable."

"There are just a few small independent banks left in San Diego -- most have been bought up by out-of-state acquirers," Mr. Wagner said. "We'll now have something that nobody else has -- an independent bank in San Diego with over $1 billion in assets."

Last month the company said it would buy $180 million-asset Upland Bank in Upland, Calif., for $18.4 million in cash and stock. That deal is also expected to close in the third quarter. Upland would be merged into First Community's Pacific Western National Bank in Los Angeles.

The two purchases would boost First Community's assets to more than $2 billion.

The company has been on a buying spree since its founding in June 2000 with the acquisition of Rancho Santa Fe and First Community Bank of the Desert in Palm Springs, whose assets totaled about $350 million. It then bought four more banks, with headquarters Los Angeles, Riverside, and San Diego counties; all have since been merged into Pacific Western or Rancho Santa Fe.

Mr. Eggemeyer, a well-known investor in community banks, said he believes there is a strong demand in Southern California for a bank that serves small and middle-market businesses. …