Banking industry consolidation on the Central Coast picked up speed on April 25 with the parent company of Bank of the Sierra announcing plans to acquire OCB Bancorp and its four branches in Santa Barbara and Ventura counties.
The $14 per share acquisition sent OCB Bancorp shares soaring more 50 percent and marks the latest move for Porterville-based Bank of the Sierra, which has been expanding its footprint in the region. Sierra purchased Coast Bancorp in San Luis Obispo in 2016 after acquiring Santa Paula’s Santa Clara Valley Bank in 2014.
The latest acquisition will bring Ojai Community Bank, Santa Barbara Community Bank, Ventura Community Bank and Santa Paula Community Bank under the Bank of the Sierra umbrella.
As of now, OCB Bancorp is the last independent banking company based in Ventura County. Community West in Goleta, Montecito Bank & Trust and American Riviera in Santa Barbara, along with Bank of Santa Maria in Santa Maria, are the final four independently owned banks in the Tri-Counties.
The Sierra and OCB boards of directors recently unanimously approved the transaction, which is valued at $35.7 million or $14 per common share, subject to certain adjustments described in the merger agreement, according to a Bank of the Sierra news release. The all stock deal is expected to be complete in the fourth quarter of 2017 and it marks a hefty premium to OCB Bancorp’s closing price of $8.74 on April 24. OCB Bancorp’s shares traded at $13.26 in late morning trading April 25, up approximately 52 percent from the prior close.
“We are excited about today’s announcement of Ojai Community Bank joining forces with us and welcome all Ojai employees, customers and shareholders into the Bank of the Sierra family,” said Kevin McPhaill, Bank of the Sierra president and CEO. “Enhancing our presence on the Central Coast fits in with our long term strategic plan. Adding branches in Ventura, Ojai and Santa Barbara increases our commitment to serving those communities. We have been impressed by Ojai’s strong commitment to its communities, disciplined growth strategies, and success, and look forward to growing this part of our bank together.”
McPhaill said the acquisition will allow the bank to deploy additional capital through lending opportunities in Ojai, Ventura and Santa Barbara.
“We anticipate this transaction will be very positive for our shareholders,” McPhaill said.
David Brubaker, president and CEO of OCB Bancorp and Ojai Community Bank, said: “We are very pleased to be joining with Bank of the Sierra and believe this is an excellent opportunity for our shareholders, customers and employees to realize enhanced value by being part of a larger financial institution with considerably deeper resources, operational scale and a steady stream of core earnings.”
As of Dec. 31, 2016, Sierra Bancorp had total assets of $2.3 billion, total loans outstanding of $1.5 billion and total deposits of $1.9 billion.
• Contact Joshua Molina at [email protected]