The deal will combine two Golden State lenders that focus on business banking across over 70 branches, which the banks say would create one of the largest banks by deposits based in California. Yet the merger would also ultimately result in one smaller bank, as measured by total assets, than the two lenders together represent on paper at second-quarter levels.
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PacWest, Banc of California merge to get smaller, others may follow
Many regional banks are already going on asset “diets” to try to get smaller ahead of Federal Reserve capital requirements that are expected to rise even for midsize banks. Smaller banks with relatively excess capital might now be able to strike deals with rivals on attractive terms.
