Banc of California, N.A. (“Banc of California”), a wholly-owned
subsidiary of Banc of California, Inc. (NYSE: BANC) and Rise
Economy announced today a $4.1 billion, three-year Community
Benefits Plan (the “Plan”). Banc of California and Rise Economy
(formerly the California Reinvestment Coalition) leaders worked
collaboratively to develop the expansive plan in connection with
Banc of California’s transformational merger with Pacific Western
Bank, a wholly-owned subsidiary of PacWest Bancorp (Nasdaq: PACW).
The Plan is intended to make a meaningful and positive impact in
communities served by the combined institution.
The Plan includes the following goals and targets, among others,
of the combined institution for the three years following the
closing of the merger:
- Small business lending of $1.45 billion, including increasing
participation in USDA Loan Programs and the State Small Business
Credit Initiative, as well as promotion of products through ethnic
minority media outlets;
- Community development lending of $2.3 billion focused on
supporting long-term affordable housing;
- $300 million in community development investments to support
low-income housing, homelessness prevention, small business
investment companies and BIPOC and women-led community development
financial institutions (CDFIs);
- Participation and support for Community Land Trusts (CLTs),
including consideration of new products to meet the unique needs of
CLTs, and $20 million in investments that support Affordable
Housing Preservation efforts by CLTs and affordable housing
developers;
- Enhanced due diligence for real estate lending to include
tracking housing code violations, evictions, and other measures to
be determined;
- The development of a strategy to support climate resiliency
programs in LMI and BIPOC communities which will include a minimum
of $250,000 in donations and other opportunities; and
- $500,000 to focus on strategic outreach, investment, support
and engagement with tribal and indigenous communities, and a
commitment to meet with Native American leaders in 2024, leading to
the development of a plan in 2024 to serve the Native American
community in the combined institution’s assessment area.
In addition, the combined institution will increase its
charitable donations and community service goals, as well as
continue to discuss community needs with Rise Economy and other
community organizations going forward.
In formulating the Plan, Banc of California and Rise Economy
members worked together to identify the initiatives of greatest
impact to low-income and BIPOC communities. With this mutual goal,
Banc of California welcomed input from Rise Economy members to
better understand areas of need and engaged in positive and
productive discussions with Rise Economy representatives. As a
result of these discussions and our shared dedication to serving
the needs of our communities, Banc of California incorporated
direct community feedback in crafting a focused and impactful Plan
for the combined company.
“Banc of California and Pacific Western Bank both have strong,
longstanding records of serving our communities and we look forward
to building upon that foundation as a combined organization to
expand our services, investments and products in communities that
need it most. Our work with Rise Economy is a model of
collaboration, with us working together to incorporate many of
their critical recommendations into our Community Benefits Plan to
make a positive impact in underserved communities. It also
showcases the positive benefits our merger will have for our
communities in the years to come,” said John Sotoodeh, Banc of
California’s Chief Operating Officer.
“We appreciate Banc of California’s commitment to helping the
communities they serve and the constructive way in which they
listened to the experience and concerns of Rise Economy members
working hard every day to build wealth in their communities. The
bank is taking a meaningful step forward in meeting the banking
needs of low-income communities and communities of color in our
state. We are excited to see Banc of California step up on priority
issues for our members, including Special Purpose Credit Programs,
affordable housing, climate resiliency, broadband access, and
support for Community Land Trusts as well as CDFIs and affordable
housing nonprofits led by people of color,” said Paulina
Gonzalez-Brito, CEO of Rise Economy.
In July, Banc of California, Inc. announced a transformational
merger with PacWest Bancorp in a deal that will create a combined
bank with approximately $36.1 billion in assets and more than 70
branches in California, as well as branches in Colorado and North
Carolina. The Plan will be submitted to the bank’s regulators to be
incorporated into the public application file in connection with
the proposed transaction and will become effective upon
consummation of the proposed transaction, which remains subject to
satisfaction of closing conditions, including receipt of required
stockholder and regulatory approvals and the concurrent closing of
a $400 million equity capital raise.
Read the complete version of Banc of California’s Community
Benefit Plan.
About Banc of California, Inc.
Banc of California, Inc. (NYSE: BANC) is a bank holding company
with $9.37 billion in assets at June 30, 2023 and one wholly-owned
banking subsidiary, Banc of California, N.A. (the Bank). The Bank
has 32 offices including 26 full-service branches located
throughout Southern California. Through our dedicated
professionals, we provide customized and innovative banking and
lending solutions to businesses, entrepreneurs and individuals
throughout California, and full stack payment processing solution
through our subsidiary Deepstack Technologies. We help to improve
the communities where we live and work, by supporting organizations
that provide financial literacy and job training, small business
support and affordable housing. With a commitment to service and to
building enduring relationships, we provide a higher standard of
banking. We look forward to helping you achieve your goals. For
more information, please visit us at www.bancofcal.com.
About Rise Economy
Rise Economy, formerly the California Reinvestment Coalition
(CRC), is a member-led alliance focused on creating a more
equitable society where Black, Indigenous, and People of Color have
access to resources and opportunities to build generational wealth.
As the largest statewide community reinvestment alliance in the
country, Rise Economy advocates for policies and practices that
promote racial and economic justice and that address the root
causes of inequality, redlining, and systemic racism. Learn more
about Rise Economy.
Cautionary Note Regarding Forward-Looking Statements
This document contains certain forward-looking statements within
the meaning of the federal securities laws with respect to the
proposed transaction between Banc of California and PacWest Bancorp
(“PacWest”) and the proposed investment by Warburg Pincus LLC and
Centerbridge Partners, L.P. (collectively, the “Investors”) in
equity securities of Banc of California pursuant to the investment
agreements entered into between the Investors and Banc of
California (the “Investment Agreements”). Forward-looking
statements may be identified by the use of the words such as “
estimate,” “plan,” “project,” “forecast,” “intend,” “expect,”
“anticipate,” “believe,” “seek,” “strategy,” “future,”
“opportunity,” “may,” “could,” “target,” “should,” “will,” “would,”
“will be,” “will continue,” “will likely result,” or similar
expressions that predict or indicate future events or trends or
that are not statements of historical matters, although not all
forward-looking statements contain such identifying words. These
forward-looking statements include, but are not limited to,
statements regarding the proposed transaction between Banc of
California and PacWest and the proposed investment by the
Investors, including statements as to the expected timing,
completion and effects of the proposed transaction. These
statements are based on various assumptions, whether or not
identified in this document, and on the current expectations of
Banc of California’s and PacWest’s management and are not
predictions of actual performance, and, as a result, are subject to
risks and uncertainties. These forward-looking statements are
provided for illustrative purposes only and are not intended to
serve as, and must not be relied on by any investor as, a
guarantee, an assurance, a prediction or a definitive statement of
fact or probability. Actual events and circumstances are difficult
or impossible to predict, may differ from assumptions and many are
beyond the control of Banc of California and PacWest. These
forward-looking statements are subject to a number of risks and
uncertainties, including, but not limited to: (i) the risk that the
proposed transaction may not be completed in a timely manner or at
all; (ii) the failure to satisfy the conditions to the consummation
of the proposed transaction, including obtaining the requisite
approval of the Banc of California stockholders and PacWest
stockholders within the time period provided in the Agreement and
Plan of Merger, dated July 25, 2023, by and among PacWest, Banc of
California and Cal Merger Sub, Inc. (the “Merger Agreement”); (iii)
the occurrence of any event, change or other circumstance that
could give rise to the termination of the Merger Agreement or the
Investment Agreements; (iv) the inability to obtain alternative
capital in the event it becomes necessary to complete the proposed
transaction; (v) the effect of the announcement or pendency of the
proposed transaction on Banc of California’s and PacWest’s business
relationships, operating results and business generally; (vi) risks
that the proposed transaction disrupts current plans and operations
of Banc of California and PacWest; (vii) potential difficulties in
retaining Banc of California and PacWest customers and employees as
a result of the proposed transaction; (viii) Banc of California’s
and PacWest’s estimates of its financial performance; (ix) changes
in general economic conditions; (x) changes in the interest rate
environment, including the recent increases in the Board of
Governors of the Federal Reserve System benchmark rate and duration
at which such increased interest rate levels are maintained, which
could adversely affect Banc of California’s and PacWest’s revenue
and expenses, the value of assets and obligations, and the
availability and cost of capital and liquidity; (xi) the impacts of
continuing inflation; (xii) the credit risks of lending activities,
which may be affected by deterioration in real estate markets and
the financial condition of borrowers, and the operational risk of
lending activities, including the effectiveness of Banc of
California’s and PacWest’s underwriting practices and the risk of
fraud; (xiii) fluctuations in the demand for loans; (xiv) the
ability to develop and maintain a strong core deposit base or other
low cost funding sources necessary to fund Banc of California’s and
PacWest’s activities particularly in a rising or high interest rate
environment; (xv) the rapid withdrawal of a significant amount of
deposits over a short period of time; (xvi) results of examinations
by regulatory authorities of Banc of California or PacWest and the
possibility that any such regulatory authority may, among other
things, limit Banc of California’s or PacWest’s business
activities, restrict Banc of California’s or PacWest’s ability to
invest in certain assets, refrain from issuing an approval or
non-objection to certain capital or other actions, increase Banc of
California’s or PacWest’s allowance for credit losses, result in
write-downs of asset values, restrict Banc of California’s or
PacWest’s ability or that of Banc of California’s or PacWest’s bank
subsidiary to pay dividends, or impose fines, penalties or
sanctions; (xvii) the impact of bank failures or other adverse
developments at other banks on general investor sentiment regarding
the stability and liquidity of banks; (xviii) changes in the
markets in which Banc of California and PacWest compete, including
with respect to the competitive landscape, technology evolution or
regulatory changes; (xix) changes in consumer spending, borrowing
and saving habits; (xx) slowdowns in securities trading or shifting
demand for security trading products; (xxi) the impact of natural
disasters or health epidemics; (xxii) legislative or regulatory
changes; (xxiii) impact of operating in a highly competitive
industry; (xxiv) reliance on third party service providers; (xxv)
competition in retaining key employees; (xxvi) risks related to
data security and privacy, including the impact of any data
security breaches, cyberattacks, employee or other internal
misconduct, malware, phishing or ransomware, physical security
breaches, natural disasters, or similar disruptions; (xxvii)
changes to accounting principles and guidelines; (xxviii) potential
litigation relating to the proposed transaction that could be
instituted against Banc of California, PacWest or their respective
directors and officers, including the effects of any outcomes
related thereto; (xxix) volatility in the trading price of Banc of
California’s or PacWest’s securities; (xxx) the ability to
implement business plans, forecasts, and other expectations after
the completion of the proposed transaction, and identify and
realize additional opportunities; and (xxxi) unexpected costs,
charges or expenses resulting from the proposed transaction. The
foregoing list of factors is not exhaustive. You should carefully
consider the foregoing factors and the other risks and
uncertainties described in the “Risk Factors” section of Banc of
California’s registration statement on Form S-4 that contains a
preliminary joint proxy statement/prospectus discussed below, and
other documents filed by Banc of California or PacWest from time to
time with the U.S. Securities and Exchange Commission (the “SEC”).
These filings do and will identify and address other important
risks and uncertainties that could cause actual events and results
to differ materially from those contained in the forward-looking
statements. If any of these risks materialize or our assumptions
prove incorrect, actual events and results could differ materially
from those contained in the forward-looking statements. There may
be additional risks that neither Banc of California nor PacWest
presently knows or that Banc of California or PacWest currently
believes are immaterial that could also cause actual events and
results to differ from those contained in the forward-looking
statements. In addition, forward-looking statements reflect Banc of
California’s and PacWest’s expectations, plans or forecasts of
future events and views as of the date of this document. Banc of
California and PacWest anticipate that subsequent events and
developments will cause Banc of California’s and PacWest’s
assessments to change. While Banc of California and PacWest may
elect to update these forward-looking statements at some point in
the future, Banc of California and PacWest specifically disclaim
any obligation to do so, unless required by applicable law. These
forward-looking statements should not be relied upon as
representing Banc of California’s and PacWest’s assessments as of
any date subsequent to the date of this document. Accordingly,
undue reliance should not be placed upon the forward-looking
statements. Forward-looking statements speak only as of the date
they are made. Neither Banc of California nor PacWest gives any
assurance that either Banc of California or PacWest, or the
combined company, will achieve the results or other matters set
forth in the forward-looking statements.
No Offer or Solicitation
This document is not a proxy statement or solicitation or a
proxy, consent or authorization with respect to any securities or
in respect of the proposed transaction and shall not constitute an
offer to sell or a solicitation of an offer to buy the securities
of Banc of California, PacWest or the combined company, nor shall
there be any sale of securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such
jurisdiction. No offer of securities shall be deemed to be made
except by means of a prospectus meeting the requirements of Section
10 of the Securities Act, and otherwise in accordance with
applicable law.
Additional Information and Where to Find It
This document relates to the proposed transaction between Banc
of California and PacWest and the proposed investment in Banc of
California by Investors. On August 28, 2023, Banc of California
filed a registration statement on Form S-4 with the SEC, which
includes a preliminary joint proxy statement/prospectus to be
distributed to holders of Banc of California’s common stock and
PacWest’s common stock in connection with Banc of California’s and
PacWest’s solicitation of proxies for the vote by Banc of
California’s stockholders and PacWest’s stockholders with respect
to the proposed transaction and also constitutes a preliminary
prospectus of Banc of California. These materials are not yet final
and may be amended. After the registration statement is declared
effective, Banc of California and PacWest will mail a definitive
joint proxy statement/prospectus to their respective stockholders
that, as of the applicable record date, are entitled to vote on the
matters being considered at the Banc of California stockholder
meeting and at the PacWest stockholder meeting, as applicable. Banc
of California or PacWest may also file other documents with the SEC
regarding the proposed transaction.
BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND
SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE ENTIRE
REGISTRATION STATEMENT AND PRELIMINARY JOINT PROXY
STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS
THERETO), AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AND
THE DEFINITIVE VERSIONS THEREOF (WHEN THEY BECOME AVAILABLE), AS
WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO SUCH DOCUMENTS, CAREFULLY
AND IN THEIR ENTIRETY BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION.
Investors and security holders may obtain free copies of the
registration statement, the preliminary joint proxy
statement/prospectus and all other relevant documents filed or that
will be filed with the SEC by Banc of California or PacWest through
the website maintained by the SEC at www.sec.gov.
The documents filed by Banc of California or PacWest with the
SEC also may be obtained free of charge at Banc of California’s or
PacWest’s website at https://investors.bancofcal.com, under the
heading “Financials and Filings” or www.pacwestbancorp.com, under
the heading “SEC Filings”, respectively, or upon written request to
Banc of California, Attention: Investor Relations, 3 MacArthur
Place, Santa Ana, CA 92707 or PacWest, Attention: Investor
Relations, 9701 Wilshire Boulevard, Suite 700, Beverly Hills, CA
90212 , respectively.
Participants in Solicitation
Banc of California and PacWest and their respective directors
and executive officers may be deemed to be participants in the
solicitation of proxies from Banc of California’s stockholders or
PacWest’s stockholders in connection with the proposed transaction
under the rules of the SEC. Banc of California’s stockholders,
PacWest’s stockholders and other interested persons may obtain,
without charge, more detailed information regarding the names,
affiliations and interests of directors and executive officers of
Banc of California and PacWest in Banc of California’s registration
statement on Form S-4, as well other documents filed by Banc of
California or PacWest from time to time with the SEC. Other
information regarding persons who may, under the rules of the SEC,
be deemed the participants in the proxy solicitation of Banc of
California’s or PacWest’s stockholders in connection with the
proposed transaction and a description of their direct and indirect
interests, by security holdings or otherwise, is included in the
preliminary joint proxy statement/prospectus and will be contained
in other relevant materials to be filed with the SEC regarding the
proposed transaction (if and when they become available). You may
obtain free copies of these documents at the SEC’s website at
www.sec.gov. Copies of documents filed with the SEC by Banc of
California or PacWest will also be available free of charge from
Banc of California or PacWest using the contact information
above.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231002729835/en/
Investor Relations Inquiries:
Banc of California, Inc. (855) 361-2262 Jared Wolff,
(949) 385-8700 Joe Kauder, (310) 844-5224 Media Contacts:
Debora Vrana, Banc of California (213) 999-4141
Debora.Vrana@bancofcal.com
Brian Maxey, Rise Economy (510) 813-7552
bmaxey@rise-economy.org
Banc of California (NYSE:BANC)
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