The bank for a changing world

BancWest has agreed to acquire Union Safe Deposit Bank BNP Paribas Group reinforces its presence in California's Central Valley

  • 28.04.2004
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BancWest, a wholly owned retail banking subsidiary of BNP Paribas, has agreed to acquire Union Safe Deposit Bank USDB). USDB operates through 19 branches in the attractive Central Valley region of California. The acquisition will strengthen BancWest's existing operations there, in line with its expansion strategy in the region.

BancWest operates through 357 branches in seven states in the Western US, primarily California and Hawaii. Including the recently announced agreement to acquire Community First (155 branches in 12 states in the Western US), this network will reach 512 branches (531 with USDB). Including Community First, BancWest will rank as the seventh largest retail bank in the Western US, a region covering 18 states, 100 million residents and with one of the highest expected growth rates for population and household income in the US. BancWest operates under the brands of Bank of the West on Western US Mainland and First Hawaiian Bank in Hawaii.

BancWest has agreed to acquire 100% of USDB. The $245 million purchase price is equivalent to 2.6 times book value and 19.5 times 2003 earnings, in line with comparable transactions in California. Following completion of the transaction, all USDB activities will continue under the Bank of the West brand.

Founded in 1897, USDB is one of the oldest community banks in the Central Valley of California. With USD 1.2 billion of assets as of December 31st 2003, USDB operates 19 branches throughout San Joaquin and Stanislaus counties, where it enjoys significant market share (12.6% and 5.3% respectively). These two sizeable counties have over 1 million residents and strong growth potential. In 2003, USDB reported total revenues of $58 million and net income of $12.6 million.

The transaction is expected to close in the third quarter of 2004, and will be accretive from the first year. Integration into Bank of the West will take place in the fourth quarter of 2004. Synergies are forecast to be significant with low execution risk given
USDB and BancWest's similar business models and geographical fit, as well as BancWest's proven track record in integrating acquisitions. USDB branches will strengthen the Valley/Nevada regional division, one of the five regional divisions of Bank of the West.

This transaction is consistent with BNP Paribas' expansion strategy in US retail banking and its disciplined acquisition policy. The transaction is subject to regulatory approvals as well as approval by USDB's shareholders. BNP Paribas and BancWest
were advised by Lehman Brothers and BNP Paribas Corporate Finance.

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About BNP Paribas and BancWest

BNP Paribas (www.bnpparibas.com) is a European leader in banking and financial services, with leading positions in Asia and an active presence in the United States. It is the first bank in terms of net income and market capitalisation in the Euro zone.
The group has one of the largest international banking networks with a presence in 85 countries and 89,400 employees, including 67,200 in Europe. BNP Paribas enjoys key positions in Corporate and Investment Banking, Private Banking & Asset Management, Insurance, Securities Services and Retail Banking.

BancWest Corporation is a wholly-owned subsidiary of BNP Paribas with assets of USD 38.9 billion. It is headquartered in Honolulu, Hawaii, with administrative headquarters in San Francisco, California. Its subsidiaries Bank of the West and First Hawaian Bank, are respectively the 5th largest retail bank in California and the 1st in Hawaii.
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