The travails of some West Coast banks are proving a windfall for at least one Oregon credit union, the $125 million Pacific Crest FCU of Klamath Falls, now the successful buyer of two northern California bank branches.
As a result of the deal, Pacific Crest expands its field of membership into two rural California communities, Dorris and Tulelake, which the CU contends is a win-win for the CU in light of a low-income community development designation.
Under a purchase/assumption agreement, Pacific Crest is buying the two branches from the ailing $1.3 billion PremierWest Bank of Medford, Ore., which in turn is unloading seven branches under a regulatory order, reportedly issued by the FDIC and state officials.
It was unclear what other CUs or banks in southern Oregon or California had also made offers on the branches.
The bank, under an agency-engineered DOR, lost $17.6 million last year and $4.1 million in the fourth quarter, officials said.
Pacific Crest, which has 13,000 members and three branches, will be able to serve some 1,200 members in Dorris and Tulelake, said Janet Buckalew, vice president-member advocacy/business development for Pacific Crest.
She said discussions with PremierWest began three months ago with the Medford bank soliciting an offer.
Buckalew said she could not say if other CUs had also made offers for the Dorris or Tulelake branches or what other CUs might have interest in other PremierWest branches.
The formal announcement from PremierWest quoted both Jim Ford, CEO of PremierWest, and Kathie Philp, president/CEO of Pacific Crest as saying the transaction will continue financial service in the communities. The release noted that the two branches had been scheduled to close April 20.