City National Corporation to Acquire Civic BanCorp, Doubling Its Assets in Bay Area; Civic's Management Team to Remain with City National.Business Editors LOS ANGELES--(BUSINESS WIRE)--Nov. 19, 2001 City National Corporation (NYSE NYSE See: New York Stock Exchange :CYN CYN Canyon ), parent company of City National Bank, and Civic BanCorp (Nasdaq:CIVC CIVC Comite Interprofessionnel du Vin de Champagne (French) ), parent of CivicBank of Commerce, today announced a definitive agreement for the acquisition of Civic by City National in a transaction currently valued at $113 million in cash and stock. Civic is one of the Bay Area's leading independent business banks, with offices throughout the East Bay and assets of $510 million, loans of $375 million and deposits of $443 million as of Sept. 30, 2001. Assuming the transaction closes in the first quarter of 2002, and excluding any revenue enhancements revenue enhancement An increase in revenues, especially by way of increased taxes. Revenue enhancement includes reducing taxpayer deductions and eliminating tax credits. , City National expects the transaction to be accretive to its GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). and cash earnings per share in 2002. "We are very pleased that Civic's talented management team and outstanding clients and shareholders will be joining City National," said City National 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. Russell Goldsmith. "During the last two years, City National Bank has steadily expanded in the San Francisco Bay Area “Bay Area” redirects here. For other uses, see Bay Area (disambiguation). The San Francisco Bay Area, colloquially known as the Bay Area or The Bay , and this combination will bring our Bay Area assets to $1 billion while extending our platform for growth in a measured and focused way in the world's 18th largest economy. "Civic's clear identity as a commercial bank, primarily in the East Bay, strongly complements our private and business banking presence on the Peninsula and our new commercial banking center in Walnut Creek Walnut Creek, residential city (1990 pop. 60,569), Contra Costa co., W Calif., in the San Francisco Bay area; inc. 1914. It is the trade and shipping center of an extensive agricultural area where walnuts are among the major product. ," Goldsmith added. Herbert C. Foster, Civic's president and chief executive officer, who will join City National as its 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 East Bay Area Executive, said: "This is an excellent fit of two relationship-based banks. The combination of Civic with California's premier private and business bank will allow our clients to continue their established relationships with our bankers -- while giving them access to an even broader array of financial products, services and capabilities. We are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that these broader capabilities will enable us to do more for our clients and to win a greater share of their business." Terms of the Transaction Under terms of the agreement, each of the 5.3 million shares of Civic stock will be exchanged -- at each shareholder's election -- either for cash of $20.25 per share or for an amount of City National stock based on the average per share price of City National common stock for a 10-day trading period immediately prior to the closing. If this average price of City National stock is (1) between $37.56 -- and $50.82 per share, each share of Civic stock may be exchanged for 0.4582 of a share of City National stock, (2) less than $37.56 per share, the exchange ratio will equal $17.21 divided by the average price of City National stock, and (3) greater than $50.82, the exchange ratio will equal $23.29 divided by the average price of City National stock. Since each Civic shareholder may elect to receive cash, stock or a combination of both, these elections may have to be pro-rated to ensure that between 47% and 53.5% of the total consideration is paid in City National stock. City National common stock received by Civic shareholders is expected to qualify as a tax-free exchange tax-free exchange An exchange of assets between taxpayers in which any gain or loss is not recognized in the period during which the exchange takes place. Rather, taxpayers are required to adjust the basis of assets exchanged. . The completion of the transaction is subject to regulatory and Civic shareholder approval. The two companies' boards of directors have approved the transaction. About Civic CivicBank of Commerce, a subsidiary of Civic BanCorp (Nasdaq:CIVC), serves companies, their owners and the professional community through 10 offices throughout the Bay Area, including its headquarters in Oakland. Sixty percent of its $375-million loan portfolio is comprised of commercial loans, and it has no technology loans. About City National Corporation City National Corporation, whose shares are traded on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. , has $9.8 billion in assets. The company's wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , City National Bank, provides banking, trust and investment services through 50 offices in 10 counties across California. For more information about City National, visit its Web site at www.cnb.com. Conference Call A call with analysts and investors will be held at 11:30 a.m., Eastern Standard Time, on Monday, Nov. 19, 2001 to review this announcement. A live Webcast of this call may be accessed through a link on City National's Web site at www.cnb.com, or at http://www.vcall.com/NASApp/VCall/EventPage?ID=79823. The call will be archived on the Web site and available for replay beginning approximately one hour after the live call ends. Except for historical information, all other information in this news release consists of forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These forward-looking statements include, but are not limited to, (i) statements about the benefits of the merger between City National and Civic, including future financial and operating results, cost savings, enhancements to revenue and accretion The act of adding portions of soil to the soil already in possession of the owner by gradual deposition through the operation of natural causes. The growth of the value of a particular item given to a person as a specific bequest under the provisions of a will between the to reported earnings that may be realized from the merger; (ii) statements about City National's and Civic's plans, objectives, expectations and intentions and other statements that are not historical facts; and (iii) other statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" or words of similar meaning. These forward-looking statements are based upon the current beliefs and expectations of City National's and Civic's management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: (1) the businesses of City National and Civic may not be combined successfully, or such combination may take longer, be more difficult, time-consuming or costly to accomplish than expected; (2) the expected growth opportunities and cost savings from the merger may not be fully realized or may take longer to realize than expected; (3) operating costs operating costs npl → gastos mpl operacionales , customer losses and business disruption following the merger, including adverse effects on relationships with employees, may be greater than expected; (4) governmental approvals of the merger may not be obtained, or adverse regulatory conditions may be imposed in connection with governmental approvals of the merger; (5) the stockholders of Civic may fail to approve the merger; (6) adverse governmental or regulatory policies may be enacted; (7) the interest rate environment may further compress margins and adversely affect net interest income; (8) the risk of continued diversification of assets and adverse changes to credit quality; (9) competition from other financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. companies in City National's and Civic's markets; (10) the concentration of City National's and Civic's operations in California may adversely affect results if the California economy or real estate market declines; and (11) the risk of an economic slowdown that would adversely affect credit quality and loan originations The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. . Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in City National's and Civic's reports (such as Annual Reports on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. and Current Reports on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. ) filed with the Securities and Exchange Commission and available at the SEC's Internet site (http://www.sec.gov). All written and oral forward-looking statements contained in this news release concerning the proposed transaction or other matters attributable to City National, Civic or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above. City National and Civic do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made. The proposed transaction will be submitted to Civic's stockholders for their consideration. City National and Civic will file a registration statement, a proxy statement/prospectus and other relevant documents concerning the proposed transaction with the SEC. Stockholders are urged to read the registration statement and the proxy statement/prospectus when it becomes available and any other relevant documents filed with the SEC, as well as any amendments or supplements to those documents, because they will contain important information. You will be able to obtain a free copy of the proxy statement/prospectus, as well as other filings containing information about City National and Civic, at the SEC's Internet site (http://www.sec.gov). Copies of the proxy statement/prospectus and the SEC filings that will be incorporated by reference in the proxy statement/prospectus can be obtained, without charge, by directing a request to Mr. Heng W. Chen, City National Corporation, 400 North Roxbury Drive, Beverly Hills Beverly Hills, city (1990 pop. 31,971), Los Angeles co., S Calif., completely surrounded by the city of Los Angeles; inc. 1914. The largely residential city is home to many motion-picture and television personalities. , California 90210 (310/888-6000) or to Secretary, Civic BanCorp, 2101 Webster Street, 14th Floor, Oakland, California “Oakland” redirects here. For other uses, see Oakland (disambiguation). Oakland (IPA: /ˈoʊklənd/), founded in 1852, is the eighth-largest city in the U.S. 94612 (510/836-6500). Civic and its directors and executive officers may be deemed to be participants in the solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of proxies from the stockholders of Civic in connection with the merger. Information about the directors and executive officers of Civic and their ownership of Civic common stock is set forth in the proxy statement Proxy Statement A document containing the information that a company is required by the SEC to provide to shareholders so they can make informed decisions about matters that will be brought up at an annual stockholder meeting. , dated April 3, 2001, for Civic's 2001 annual meeting of stockholders, as previously filed with the SEC on a Schedule 14A. Additional information regarding the interests of these participants may be obtained by reading the proxy statement/prospectus regarding the proposed transaction when it becomes available.
City National / Civic
At-a-Glance
At or for the Period Ended
Sept. 30, 2001
($ in millions) City National Civic
Total Assets $9,786 $510
Equity $875 $58
Market Capitalization (11/16/01) $2,039 $82
Net Income (9 months '01) $107.4 $3.8
Total Deposits $7,400 $443
Total Loans $6,758 $375
Commercial Loans to Total Loans 44% 60%
Construction Loans to Total Loans 9% 2%
NPAs / Total Loans 0.59% 1.25%
Reserves / Loans 2.00% 1.86%
Reserves / NPAs 342% 148%
Net Interest Margin (3Q) 5.28% 5.27%
Cash Efficiency Ratio (3Q) 49.5% 66.6%
Offices in East Bay Area 1 8
Total Banking Offices 50 10
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