Pacific Commerce : Mystery Investor Persists

The mystery over the unidentified investor who wants to buy as much as 20,000 shares of Pacific Commerce Bank’s common stock continues, as an additional letter on behalf of the would-be buyer has been mailed to the bank’s shareholders that identifies a San Diego law firm as the drop-off site for stock certificates to be sold.

The law firm of Miller, Boyko & Bell is accepting shares to be transferred and has been “instructed to immediately issue you a check or could make arrangements for a cashier’s check, if so desired,” according to a letter written by the unidentified investor’s attorney, Gary Findley of Brea, in Orange County.

“I strongly suggest that you consider my offer in light of the current market value,” Findley wrote.

The $15-per-share offer is 50% over the bank’s per-share book value, but is equal to the price that the stock has been selling for recently.

The first letter has “raised quite a bit of interest,” Findley said. He declined to say exactly how many shares actually had been sold, however.

If the mystery buyer were to acquire all 20,000 shares, his stake in the Chula Vista bank still would be less than 10%, Findley said.

Soon after the first Findley letter, Pacific Commerce Chairman A.B. Salganick and President Tom Michelli sent their own letter, reminding shareholders that the anonymous buyer’s offer is “not a premium price for the stock,” and urging investors to consider the “possible future appreciation of your investment” in the bank.

Michelli is contemplating another mailing in response to Findley’s second letter.

Sources close to the bank anticipate that Findley will send yet another letter to Pacific Commerce shareholders, perhaps raising the $15-per-share offer. Findley would not comment on that possibility.

For the six months ended June 30, Pacific Commerce reported net income of $50,359 compared to a loss of $61,800 in the first half last year. Assets rose 113% to $13.3 million, deposits increased 224% to $10 million and net loans rose 295% to $8 million.

Loan loss reserves increased to $40,000 from $2,000 on June 30 last year, according to Michelli. The bank opened for business in April, 1984.

Currently, the bank’s loan loss reserves total 0.65% of its total loans, shy of the 0.8% goal regulators have asked the bank to reach, said Michelli.

“We’re shooting to have reserves of 1% (eventually) and 0.8% by the end of the year,” he said.