The Federal Reserve Board in Washington has approved the $12-million purchase of Citizens Bank in Costa Mesa by Australian industrialist Richard Pratt, leaving only approval from the state Banking Department necessary to complete the sale.
And state approval should come within two weeks, said David Scott, a deputy state banking superintendent.
Thus, with barely a ripple in its operations, the 13-year-old bank should find its 1.1 million shares sold for about $11 a share in mid-April to Citizens Holdings, Pratt's newly formed bank holding company, said Robert Mast, the bank's senior vice president and chief financial officer.
Pratt has told state regulators that he will keep all of Citizens' directors, officers and employees in place but will expand the board to add three of his own directors. Those three also will sit on the board of Citizens Holdings, which is to be chaired by Paige V. Simpson, the bank's longtime president.
Pratt, whose Pratt Group is the largest manufacturer of corrugated boxes in Australia, already has deposited $12 million with Security Pacific National Bank, which is being used by the transfer agent, First Interstate Bank, to distribute the money to current shareholders, Mast said. So far, 97% of the stock has been tendered, he said.
The U.S. Department of Justice has imposed a mandatory 30-day waiting period on what is technically a merger to check for possible antitrust violations, but Mast said the routine delay imposed in all bank mergers should expire April 14 with no action taken because the transaction is, in essence, a sale.
The purchase had been before regulators for the last five months, but bank officers and Pratt's lawyer said previously that they expected the approval process to take some time because of the complex ownership scheme.
Citizens Holdings is owned by a series of Pratt corporations and partnerships in California, the United Kingdom, Netherlands Antilles, the Netherlands and Australia--all for tax purposes, they said. The ultimate owner of those corporations and partnerships is a trust that Pratt established for his children.