Mergers are all the rage for Treasure Valley banks.
In the latest of five sales in the past year, Boise-based Northwest Bank will establish a presence in a market it had coveted the Seattle metro area by purchasing Regal Financial Bank, said Rob Perez, Idaho president of Northwest Bank.
Entering the Seattle market creates more long-term value for shareholders, Perez said. We are able to take advantage of high-growth markets that are also deeper markets than the Boise market. It should translate to more rapid growth, which will be good for shareholders.
Both institutions are commercial banks. Regal Financial's single location in Downtown Seattle, which will convert to a Northwest office if the sale is approved.
Northwest expects to receive regulatory approval by Sept. 30.
Northwest Bank now has offices in Boise, Seattle and Lake Oswego, Ore., in the Portland metropolitan market.
Northwest Bank controls nearly $258 million in assets and $210 million in deposits. The bank reported a $254,000 profit for the last quarter. Regal Financial Bank holds nearly $99 million in assets and $87 million in deposits. The bank reported a paltry a profit in the last quarter.
Regal Financial became deeply troubled during the recession but has cleared most of its bad loans from its books, Perez said.
Regal Financial opened a loan production office in Meridian in 2005. The office closed in 2008.
Regal was founded by its original CEO, Boise State University graduate Jesse Tam. Tam and Regal Financial were alleged in a lawsuit to have taken part in a $175-million pyramid scheme perpetrated by an investment group, Dressel Investments, according to the Seattle Post-Intelligencer. The suit was settled out of court. Tam, who said he and the bank handled only legal banking functions in its work with Dressel Investments, left the bank in 2009, according to his LinkedIn account.
Zach Kyle: 377-6464, Twitter: @IDS_zachkyle