Umpqua Holdings Corp. (UMPQ) said on Friday that its unit, Umpqua Bank, has acquired the banking operations of Reno, Nevada-based Nevada Security Bank and its California division, Silverado Bank, in a purchase and assumption agreement with the Federal Deposit Insurance Corp. or FDIC.This is the fourth FDIC-assisted transaction for Umpqua Bank this year following its January 22 acquisition of Seattle-based EvergreenBank.
As of March 31, 2010, Nevada Security Bank had about $480.3 million in assets and $479.8 million in deposits. Nevada Security Bank’s $342 million in loans are subject to a loss-sharing agreement with the FDIC. Umpqua Bank expects the acquisition to be immediately accretive to operating earnings per share. The transaction will increase Umpqua’s assets to about $11.0 billion and deposits to about $8.6 billion, based on Umpqua’s March 31, 2010 balances.
The five branches of Nevada Security Bank will reopen on Monday as branches of Umpqua Bank. The FDIC estimates that the cost to the Deposit Insurance Fund on this transaction will be $80.9 million. Nevada Security Bank is the 83rd FDIC-insured institution to fail in the nation this year, and the third in Nevada.
Roseburg, Oregon-based Umpqua Bank participated in a competitive bid process with the FDIC. The accepted bid included no deposit premium and a discount bid of 4.9% on assets acquired. The transaction increases Umpqua’s network to 181 store locations throughout Northern Nevada, Northern California, Oregon and Washington.Umpqua Bank expects to convert Nevada Security Bank’s consumer banking, residential lending, commercial and small business services to the Umpqua Bank brand over the next several months.
UMPQ closed Friday’s regular trading session at $12.56, up $0.21 or 1.70% on a volume of 0.96 million shares, higher than the three-month average volume of 1.28 million shares.
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