Columbia Banking System and Umpqua Holdings have secured the final regulatory approval needed to proceed with their $5 billion merger.
The Federal Deposit Insurance Corp. has green-lighted the deal, the banks said this week. The acquisition is set to close by the end of February.
"We are excited to advance to the last phase of our combination and achieve our vision of creating a leading Western bank," Columbia CEO Clint Stein said in a statement.
The deal is expected to create a powerhouse Pacific Northwest bank with more than $52 billion in assets. The combined bank will have a branch network that stretches across five states: Washington, Oregon, California, Idaho and Nevada.
The Federal Reserve
Columbia is the smaller bank in terms of assets but will serve as the acquirer. The plan is to combine Umpqua's strong consumer brand with Columbia's commercial banking specialties.
The bank's holding company will be headquartered in Tacoma, Wash., and operate as Columbia Banking System Inc. The bank itself is set to operate as Umpqua Bank, with headquarters in Lake Oswego, Ore.
To gain approval from federal banking regulators, Columbia agreed to divest 10 branches identified by the Department of Justice, which examines the antitrust implications of bank mergers.
Meanwhile, Nasdaq told Umpqua this month that it was out of compliance with a provision that requires listed companies to hold annual shareholder meetings. The bank — which delayed its meeting because of the pending combination with Columbia — said it intends to submit a plan to comply with the rule by the stock exchange's stated deadline of Feb. 19. The notice from the Nasdaq doesn't affect the trading of the bank's shares.
Once the deal is complete, the merged company will trade under the ticker symbol "COLB" on the Nasdaq Composite.
Columbia is expected to report earnings next week.
