Grandpoint Capital, Inc., and Capitol Bancorp Limited (NYSE: CBC) jointly announced today the planned sale of Capitol's Tucson operations involving Bank of Tucson and Southern Arizona Community Bank to Grandpoint Capital, Inc.
The transaction will be structured as a whole-bank purchase of the single-office, $99.4 million Southern Arizona Community Bank, which is expected to generate aggregate cash proceeds for Capitol in excess of $11 million, simultaneous with a traditional purchase-and-assumption transaction for the main office operations of the Bank of Tucson. As part of the transaction, Grandpoint Capital will purchase some Bank of Tucson loans. The consolidated operations, with total assets of approximately $270 million, will conduct business under the Bank of Tucson name.
The transaction, which is subject to regulatory approval, is expected to be completed in 2010. At completion, Grandpoint Capital will have an ownership interest in the bank of approximately 80 percent with the balance held by a group of local Arizona investors.
"Grandpoint Capital's strategy is to build strong banks around strong management in markets where we can make a difference," said Don M. Griffith, chairman and chief executive officer of Grandpoint Capital. "This acquisition is an opportunity to build on a well established banking platform in a market we believe has tremendous long-term value. We'll do that by combining our capital with the outstanding talent and experience of the local management team, led by Bank of Tucson President and CEO Mike Hannley, who will serve in the same capacity for the new, combined operation."
Hannley, who partnered with Capitol Bancorp to launch Bank of Tucson in 1996, is a 38-year banking veteran. Southern Arizona Community Bank President and CEO John P. Lewis will serve as vice chair of the consolidated organization. Lewis has been in banking since 1966 and was recruited by Capitol Bancorp in 1998 to start Southern Arizona Community Bank. He was appointed last year to serve on the FDIC's 14-member Advisory Committee on Community Banking.
Griffith, who served on the board of directors of the former Tucson-based Arizona Bank for roughly 10 years in the 1990s, is well acquainted with the Arizona market and the opportunities it presents. Arizona Bank was the largest independent bank in the state before its sale to Compass Bank in 1998. Among the prominent local Arizona investors who will participate in the pending acquisition are two individuals formerly associated with Arizona Bank, David T. C. Wright, former president and CEO of Arizona Bank, who will serve as the chair of the executive committee, and Jim Click, former chairman of the board of Arizona Bank, who will become chairman of the board of the new, combined bank. Click and Robert H. Tuttle, former U.S. Ambassador to the Court of St. James's, were majority shareholders of Arizona Bank and are co-owners of Tucson-based Jim Click Automotive Team. Tuttle is an investor in Grandpoint Capital, Inc. Both Hannley and Lewis have previously worked with Wright.
"These are very accomplished and distinguished business leaders, who know banking and the southern Arizona market well," said Griffith. "We are pleased to have their support and participation in this acquisition."
Grandpoint Capital launched Grandpoint Bank in California in June 2010, through the acquisition of Santa Ana Business Bank in Santa Ana, Calif., with a total capital investment of $75 million. On July 14, 2010, the bank holding company announced a definitive agreement to acquire First Commerce Bank. The two First Commerce offices, in Encino and Brentwood, Calif., will become part of Grandpoint Bank when the transaction closes, which is expected by year-end 2010. Grandpoint Bank also has plans to open a future office later this year in the South Bay area of Los Angeles, a region well known to Griffith and Grandpoint Capital's Chief Operating Officer Deborah A. Marsten, who have both managed banks headquartered there over the past 15 years.
Grandpoint Capital, Inc., is a bank holding company headquartered at 333 South Grand Avenue, Suite 4250, Los Angeles, Calif. Grandpoint Bank has offices in downtown Los Angeles, at 355 South Grand Avenue, Suite 2400, and in Santa Ana, Calif., at 1666 North Main Street. The bank serves small and mid-sized businesses, professionals and entrepreneurs, and high-net-worth individuals with an integrated product set of private client services, business banking and treasury management capabilities. It also provides correspondent services to financial institutions. At June 30, 2010, Grandpoint Bank had total assets of $95 million.
Capitol Bancorp Limited (NYSE: CBC) is a $5.1 billion national community banking company with a network of separately chartered banks in 15 states. Founded in 1988, Capitol Bancorp Limited has executive offices in Lansing, Michigan, and Phoenix, Arizona.
Forward Looking Statements
Certain statements in this press release contain forward-looking statements that are based on management’s expectations, estimates, projections and assumptions. Words such as "expects," "anticipates," "plans," "believes," "scheduled," "estimates" and variations of these words and similar expressions are intended to identify forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results and trends may differ materially from what is forecast in forward-looking statements due to a variety of factors.
All forward-looking statements speak only as of the date of this press release. All subsequent written and oral forward-looking statements attributable to either Grandpoint Capital or First Commerce Bancorp or any person acting on their behalf are qualified by the cautionary statements in this press release. Grandpoint Capital and First Commerce Bancorp do not undertake any obligation to update or publicly release any revisions to forward-looking statements to reflect events, circumstances or changes in expectations after the date of this press release.
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