TACOMA, Wash.—The $1.5-billion Sound Credit Union has agreed to acquire the $200-million Bank of Washington, based in Lynwood, Wash.
The agreement has been signed with Washington Bancorp Inc., the holding company for the Bank of Washington, and the transaction will be structured with Sound Credit Union purchasing substantially all of the assets and assuming substantially all of the liabilities of the Bank of Washington, the credit union reported.
In 2017, Bank of Washington reported net income of $477,000, and it showed a profit of $348,000 through June of 2018.
The transaction has been unanimously approved by the boards of directors of both institutions and is subject to regulatory approval, approval by the shareholders of Washington Bancorp, Inc. and other customary approvals. The transaction is anticipated to be completed in the first quarter of 2019. It is anticipated that WGTB shareholders will receive approximately $6.40 in cash per share, based on the outstanding shares as of the date of the purchase agreement, the CU said.
After the $30 million all-cash deal is closed, Sound CU will have approximately $1.7 billion in assets, $1.3 billion in loans, $1.5 billion in deposits and operate 29 branches throughout King, Pierce, Snohomish and Thurston Counties, the credit union reported.
Expanding Footprint
“We are excited to announce the acquisition of Bank of Washington’s assets,” said Don Clark, Sound Credit Union’s president and CEO. “This combination will help us further expand our footprint in Snohomish and King Counties, accelerate our business and mortgage lending efforts, and add great employees. We feel the value and cultures of both companies are very similar with a strong commitment to customers and the communities in which we serve.”
“We are enthusiastic about this partnership because of the expanded opportunities it brings to our customers, our employees and our communities,” added Marty Steele, Washington Bancorp, Inc.’s president and CEO. “This deal rewards our long-term shareholders who have supported us for many years. As a larger and stronger financial institution with a significantly higher legal lending limit, we will be better able to compete in today’s competitive environment and serve our customers. Sound Credit Union is a strong local financial institution with a long history of meeting the financial needs of both businesses and consumers in the greater Puget Sound market.”
“This is the first CU purchase of a bank in Washington State. This is truly a nationally relevant option for CUs and Banks. You will see more transactions in the western region soon,” said Michael Bell, attorney and counselor at Royal-Oak, Mich.-based Howard & Howard, who represents Sound CU and who has been part of 23 CU/bank deals, including three mergers of a bank into a credit union.