PacWest Bancorp in Los Angeles has agreed to buy the MUFG Union Bank's Homeowners Association Services division.
The $29 billion-asset PacWest said in a press release Thursday that its bank will buy the business, which provides services to community management companies and their homeowners associations. PacWest said it will pay about $250 million in cash for certain assets and liabilities, including a 5.9% premium for deposits.
The deal is expected to close in the fourth quarter.
“We are very pleased to announce this acquisition, which we believe will significantly enhance our position catering to the specialized banking needs of community management companies and the HOA clients they serve,” Matt Wagner, PacWest’s president and CEO, said in the release.
“This HOA business … will provide Pacific Western Bank with what we believe is a robust HOA banking services technology platform and an experienced and accomplished team in an important niche market segment,” Wagner said.
Kimberly Siebler will continue to lead the business after it changes hands. The division’s employees will also transition to PacWest.
The division has about $4 billion of deposits with an average cost of 0.08%. PacWest said the “high-quality, low-cost deposits” should provide an “attractive funding source in a rising interest rate environment.”
PacWest said the deal should be accretive to its earnings per share, with the timing based on future liquidity deployment, its loan mix and yields.
Piper Sandler and Holland & Knight advised PacWest. Keefe, Bruyette & Woods and Pillsbury Winthrop Shaw Pittman advised MUFG Union Bank.
