A Ventura County banking firm reached agreement Friday to acquire Frontier National Bank in La Palma for more than $8.5 million in cash.
The acquisition by Ventura County National Bancorp in Oxnard is subject to the approval of federal regulators and the shareholders of Frontier’s parent firm, Frontier Group Inc.
Under the agreement, Frontier Bank will operate as a subsidiary of Ventura and continue with its current management plan of attracting business customers in north Orange County, said Charles M. Matter, Frontier’s president and chief executive.
The purchase price is expected to give Frontier shareholders a return of about five times their original investment, Matter said.
“Ventura executives recognize that this bank has done well in its 6-year existence in an area that has been overlooked,” he said. “They’re a business bank, and we are too. But they’re much larger, and they have developed some services that we can provide our customers.”
He said he was particularly excited about using Ventura’s automated accounts management system, which allows bank customers to gain access to their deposit and loan accounts from their own personal computers so they can review transactions, switch funds between accounts and even make investments.
“As a small independent bank, we could never afford to offer such services,” he said.
Matter said Ventura plans to increase Frontier’s size as it goes after more banking customers. Ventura also hopes to acquire banks elsewhere in Southern California, he said.
In 1986, Ventura acquired Conejo Valley National Bank in Thousand Oaks and merged it the following year into its primary subsidiary, Ventura County National Bank.
Frontier Group, which is 40% owned by its board of directors, ended 1988 with $69.5 million in assets and an annual net income of $480,000, Matter said. Two directors own 9% of the stock and a few other shareholders own 5% to 9% of the stock. Matter said he owns about 8%.
With the acquisition, Ventura would become a banking company with $290 million in assets. Last year, it earned $2.1 million.