BREAKING: Bank of Alameda to be acquired

BREAKING: Bank of Alameda to be acquired

Michele Ellson
Bank of Alameda

The Bank of Alameda is set to be acquired by the Bank of Marin, the Novato-based bank announced Monday.

"Bank of Marin can provide the resources Bank of Alameda needs to continue providing our customers with the dedicated community-based banking and the high level of personal service that they have come to enjoy,” said James B. Davis, chairman of the board for NorCal Community Bancorp, the Bank of Alameda’s parent company.

In a press release issued Monday by the Bank of Marin, Davis is quoted as saying the deal will offer local customers more products and services and larger business loans.

The acquisition of the 15-year-old Alameda bank, in a deal valued at $32.7 million or $3.07 per share of common stock, is expected to close by the end of this year. The Bank of Marin plans to pay for the local bank using 51 percent stock and 49 percent cash, the release says.

As of March 31, the Bank of Alameda had assets of $264.7 million, deposits of $228.7 million and loans of $170.6 million. The Bank of Marin will have $1.7 billion in assets when the deal closes, along with 21 bank branches in five Bay Area counties, including four the Bank of Alameda now operates.

Bank of Marin stock was trading at $40.51 on Monday, up 51 cents, while Bank of Alameda’s dropped nine cents, to $2.66 per share.

Closure of the deal is subject to shareholder and regulatory approval. Once the deal closes, Kevin Kennedy, Alameda’s city treasurer and a member of the Bank of Alameda’s board, will join the Bank of Marin board.

Additional information about the deal is to be offered during a conference call and webcast Tuesday morning.

Bank of Alameda struggled in 2009 and 2010, losing nearly $11 million over those two years due to weak construction and real estate loans, which were a major business line for the bank. The bank was also forced to restate its earnings to account for loan losses and entered a consent order with federal and state regulators.

But the bank’s leaders raised $7.45 million and reduced problem assets, turning profits in 2011 and 2012 and increasing the bank’s assets.

Bank of Marin opened in 1990 and has been recognized as a top community bank. The bank, which reportedly acquired Napa’s Charter Oak Bank in 2011 after the state’s bank regulators decided to close that bank, announced record earnings of $17.8 million in 2012.

The acquisition announcement follows a similar one in May from the Alameda Credit Union, which is pursuing a merger with Provident Credit Union in Redwood City.

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