CU Bancorp to Acquire Bay Cities National Bank

CU Bancorp, the Encino-based parent of California United Bank, has signed a letter of intent to merge with the much-smaller Redondo Beach-based Bay Cities National Bank, the two institutions said.

Under terms of the deal, expected to close in the fourth quarter, CU Bancorp will issue common stock to shareholders of Bay Cities based upon the adjusted book value of the two institutions. Completion of the deal is subject to shareholder and regulatory approval, and the signing of a definitive agreement.

Patrick Hartman, CU Bancorp’s chief financial officer, said Bay Cities was in a good location and provided an opportunity for CU Bancorp to grow. Late last year, California United Bank opened a loan production center in the South Bay. For the first quarter, CU Bancorp had a profit of $578,000. Bay Cities National Bank, with assets of $64 million, posted a first-quarter profit of $104,000.