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Washington Mutual in Deal for Irvine Bank

April 24, 2006|From Reuters

Washington Mutual Inc., the largest U.S. savings and loan, on Sunday said it had agreed to buy Commercial Capital Bancorp Inc. of Irvine to strengthen its commercial and retail banking business in a deal valued at $983 million.

Washington Mutual said it would pay $16 a share in cash for Commercial Capital's outstanding stock, representing a 13% premium over Friday's closing price.

"Today's transaction strengthens our already solid position in the attractive California multifamily and small commercial real estate lending markets," Kerry Killinger, Washington Mutual's chairman and chief executive, said in a statement.

The deal also gives the Seattle-based thrift "opportunities for household acquisition, deposit growth and increased retail product cross-sell to Commercial Capital's existing retail customer base," Killinger added.

Analysts have expected banking consolidation in the affluent Southern California area.

Washington Mutual last week said in its first-quarter earnings results that home loan volume for the nation's No. 3 mortgage lender rose 1% to $45 billion, but mortgage lending income fell 32% -- a trend consistent with the performance of other large mortgage lenders.

Washington Mutual said that it expected the deal to add 4 cents a share to the company's 2007 earnings and that the acquisition was expected to close in the third quarter of 2006.

The companies said in a joint statement that Commercial Capital clients should expect their accounts, policies and payment procedures to remain unchanged.

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