In explaining the decision, Banner Corp. president/CEO Gary Sirmon says Oregon Business Bank was the fastest growing financial institution in Oregon in 2000, and its headquarters is located a few blocks from Banner's construction and mortgage lending subsidiary, Community Financial Corporation. "The addition of Oregon Business Bank to our franchise broadens our presence in the important Portland market," says Sirmon.
Oregon Business Bank is a state-chartered institution that is not publicly traded. James W. Shires, president of Oregon Business Bank, says the merger will allow Oregon Business Bank to offer additional deposit products, larger lending limits, improved technology and administrative efficiencies.
Opened in October 1999, Oregon Business Bank is a commercial community bank with $41.5 million in assets, $32.5 million in gross loans, $35.8 million in deposits and shareholders' equity of $4.7 million at August 31, 2001. The purchase price represents approximately 212% of book value at August 31, 2001.
Banner Corp's Banner Bank, a Washington state chartered commercial bank operates a total of 38 branch offices and six loan offices in 18 counties in Washington, Oregon and Idaho. "Given Oregon Business Bank's rapid growth and experienced staff, complemented by CFC's current customer base, we expect this acquisition to be immediately accretive to net income and ROE," said Sirmon. "Banner Bank has been considering a full-service banking facility in the Lake Oswego area since we opened CFC. When this opportunity arose, we viewed it as a way to meet our objective in a timely and efficient manner."
Banner's share price on Wednesday afternoon was up $0.70 from Tuesday's close to $18.10 per share in afternoon trading on the Nasdaq National Market. The share price is recovering after dropping from $22.50 on Sept. 10, the day before the market shut down for a week, to $15.15 on Sept. 21 before beginning its rebound.
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