Pacific Community to Acquire 2 Banks

Pacific Community Banking Group, a new bank holding company based in Laguna Hills, said Thursday it has agreed to buy two Riverside County banks for a total of $63.9 million.

Pacific is acquiring Bank of Hemet for $49.3 million, or $58.50 a share, and Valley Bank of Moreno Valley for $14.6 million, or $12.50 a share.

The purchase price of Bank of Hemet represents a 24% premium over its stock price, which was last bid at $47 a share in over-the-counter trading. Pacific is paying a 49% premium for Valley Bank, whose stock was last bid at $8.38 a share in over-the-counter trading.

Pacific, founded by former Monarch Bancorp Chief Executive E. Lynn Caswell, hopes to pay for the acquisitions with the proceeds from an initial public stock offering planned for this fall.

The company, which will apply for listing on the Nasdaq, has yet to file a registration statement with the Securities and Exchange Commission.

The acquisitions, if completed, would give Pacific assets of about $370 million.

Bank of Hemet, which is based in Riverside, has five offices with about $245 million in assets. Its chairman, John J. McDonough, will become a director of Pacific Community and a consultant to Bank of Hemet.

Valley Bank has seven offices in Riverside and San Bernardino counties, and about $80 million in assets. Its president, N. Douglas Mills, will become executive vice president of Pacific.

For the six months ended June 30, Valley Bank’s profit rose 40% to $571,000.