Cathay in pact to buy First Public Savings: deal may form largest Chinese-owned bank in U.S.CHINATOWN - Cathay Bancorp Inc.'s proposed acquisition of First Public Savings Bank savings bank, financial institution that, until recently, performed only the following functions: receiving savings deposits of individuals, investing them, and providing a modest return to its depositors in the form of interest. may create the largest Chinese-owned bank in L.A. County and the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Chinatown-based Cathay Bancorp, holding company of Cathay Bank Cathay Bank (Chinese: 國泰銀行) is a Chinese-American bank based in Los Angeles, California. Founded in 1962, it has since expanded its network throughout California and into Massachusetts, New York, Texas, Washington, Illinois, and New Jersey (pending the , with about $1.2 billion in assets, announced in late May that it had signed a deal to buy Chinatown-based First Public, with about $300 million in assets. Under the terms of the deal, Cathay will pay $31.6 million in cash and stock. If the deal is approved by regulators, it would create a $1.5 billion institution which may be the largest Chinese-owned bank in the U.S., said Dunson Cheng, chairman of Cathay Bank. East-West Bank, currently the largest Chinese-owned bank in L.A. County and the U.S., has about $1.5 billion in assets, said Dominic Ng, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of that San Marino-based bank. He said the merged bank may be bigger, but he doesn't mind. "If they want to be the biggest, we'll be happy to yield," Ng said. Ranking not paramount Cheng said he is not looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. Cathay to be the largest. "It's not a big deal," Cheng said. "We are $1.5 billion. When you talk about (San Francisco-based) Bank of America
Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world. , they are more than $200 billion in assets. We are only 1/200th of their size." Cathay Bancorp's outlay for First Public amounts to about 1.4 times that bank's equity, Cheng said. It will pay 51 percent in cash and 49 percent in stock. Shares in Cathay Bancorp, founded in 1962, are traded on Nasdaq. First Public, founded in 1979, is privately held by about 100 investors, many of them Chinese-American business people in the Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. area, Cheng said. The two banks were both started by Chinese-American business people who had difficulty getting loans from existing banks. Tellers at both banks speak English, Cantonese and Mandarin. Cathay operates 10 branches in Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, and five in Northern California Northern California, sometimes referred to as NorCal, is the northern portion of the U.S. state of California. The region contains the San Francisco Bay Area, the state capital, Sacramento; as well as the substantial natural beauty of the redwood forests, the northern , plus two overseas offices in Taiwan and Hong Kong. First Public operates five branches in Southern California. Cheng said Cathay plans to operate all five First Public branches and gain a "working understanding" of the operation before making any decisions about whether to close First Public branches or merge them into Cathay branches. New York-based investment firm Merrill Lynch & Co, acted as a financial adviser for Cathay. San Francisco-based investment firm Montgomery Securities was First Public's financial adviser. Downtown L.A.-based General Bank, another large Chinese-owned bank with about $1.4 billion in assets, announced in March 1993 that it planned to acquire First Public. But in May of that year they announced the deal was off. Jack Lee, chairman of First Public, said General Bank backed off after receiving a letter from federal banking regulators "discouraging" the acquisition. Li-Pei Wu, chairman of General Bank, declined to comment, saying it is the bank's policy not to comment on "anything having to do with regulatory matters." |
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