Bank of Marin expanding in Northern California with American River deal

Bank of Marin Bancorp in Novato, Calif., has agreed to buy American River Bankshares in Sacramento, Calif.

The $3.1 billion asset Bank of Marin said in a press release Monday that it will pay $134.5 million in stock for the $916 million-asset American River. The deal, which is expected to close in the third quarter, priced American River at 175% of its tangible book value.

American River has 10 branches, $789 million of deposits and $475 million of loans.

“This merger brings together two exceptional institutions that share complementary values and disciplined fundamentals,” Russell Colombo, Bank of Marin’s president and CEO, said in the release. “Bank of Marin will be able to expand its franchise by delivering the same legendary service that is the hallmark of a community bank on a regional scale.”

The transaction is expected to be 14.2% accretive to Bank of Marin’s 2022 earnings. It should take less than four years for Bank of Marin to earn back a projected 3.9% dilution to its tangible book value.

Bank of Marin said it plans to cut about $6.1 million of annual noninterest expenses, or roughly 35% of American River’s operating costs. Bank of Marin expects to incur $9.5 million of merger-related expenses.

Bank of Marin will add two American River directors to its board.

Bank of Marin was advised by Keefe, Bruyette & Woods and Stuart Moore Staub. American River was advised by Piper Sandler and Manatt, Phelps & Phillips.

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