Great Western Bank said Monday that it has agreed to pay $150 million to buy 63 Florida branches of CenTrust Bank of Miami, which will give Great Western the largest branch network of any savings institution in Florida.
"By more than doubling our retail banking presence in Florida, this transaction will give us the largest savings branch networks in California and Florida, the two best growth markets for retail banking in the country," said James F. Montgomery, chairman and chief executive of Great Western, the nation's second-largest thrift. The purchase will give Great Western 114 branches in Florida with $4 billion in retail deposits.
The Beverly Hills-based savings and loan will pay a premium of $100 million for the approximately $2.4 billion in CenTrust deposits. Great Western will also buy the physical assets of the 63 branches for book value, or about $50 million, Great Western spokesman Ian Campbell said.
The transaction will provide a slight boost to Great Western's earnings because the S&L; will use the bulk of the low-cost deposits to retire higher-cost borrowings, Campbell said. He declined to speculate what the effect on earnings would be except to say that it would be "modest."
CenTrust, which will keep eight branches as well as a network of loan production centers in Florida, said it will remain Florida's largest thrift with $6.5 billion in assets after the sale. It also operates a nationwide mortgage and insurance origination network.
CenTrust is an ailing S&L; that has been under pressure from federal regulators to strengthen its capital.
Great Western will offer jobs to the roughly 600 employees at the 63 CenTrust branches. The acquisition will bring Great Western's nationwide branch network to 1,047 offices in 34 states.
The sale is subject to approval by regulators.