Chilean bank Banco de Credito e Inversiones has agreed to buy the $4.7 billion-asset City National Bank of Florida from Spain's Bankia for $882.8 million.
It is the largest bank deal of the year by deal value. The next largest is United Bankshares' agreement to buy Virginia Commerce Bancorp for $495 million.
BCI would pay 1.5 times City National's tangible book value, the companies said in a press release Friday.
BCI, which has assets of $36 billion, is the third largest bank in Chile. It has operated a branch in Miami since 1999; the branch has $3 billion of assets.
"BCI has been successfully operating in Miami for 12 years through our subsidiary," Lionel Olavarría, chief executive of BCI, said in the press release. "We see great opportunities in the Miami market, and we know it well. As part of our international strategy, the purchase of CNB is the next natural step in that market."
The deal is set to close by yearend, and the plan is to keep the City National brand.
The deal's value equals 12.6% of BCI's total market capitalization, The Wall Street Journal
A recapitalization agreement between Spanish banks and the European Union requiring Bankia to sell its foreign noncore businesses forced it to put the Miami bank on the market.
Bidders had included Toronto-Dominion Bank (TD), BB&T (BBT), PNC Financial Services Group (PNC), Banco Popular (POP) and Banco Sabadell (SAB), according to a
Caja Madrid, a predecessor of Bankia, paid $927 million for City National in 2008. It took steep losses on City National's loans during the financial crisis. City National has since returned to profitability and become well capitalized. It has 20 branches.
