First Midwest acquires Popular's Chicago operations
Itasca-based First Midwest Bancorp, the parent company of First Midwest Bank, said Wednesday it will acquire the Chicago operations of Popular Community Bank, a subsidiary of Popular, Inc.
Terms of the acquisition were not announced.
First Midwest will take over Popular Community Bank's retail banking offices and its small business and middle market commercial lending activities in the Chicago metropolitan area, including 12 full-service retail branches, about $750 million in deposits and about $525 million in loans. The deposit premium for the transaction is 2.5 percent, the company said in a release.
"We are excited to welcome the clients of Popular Community Bank to First Midwest," said First Midwest President and Chief Executive Officer Michael L. Scudder. "This acquisition is consistent with our desire to expand our footprint in Chicago and surrounding suburban markets.
"We are very pleased to add experienced commercial and retail lending teams that share our commitment of delivering personal attention and a full range of business, retail and wealth management," Scudder added.
Popular Community Bank's parent company, the North American unit of Puerto Rico-based Banco Popular, said earlier this month that it was leaving the Chicago, Los Angeles and Central Florida markets to focus more on key markets. Popular Inc.'s headquarters in Rosemont and Orlando, Fla., will be closed and operations will be relocated to New York and Puerto Rico, the bank said in a release. Overall, the bank is selling off 41 branches, about $1.8 billion in related loan portfolios, and about $2.1 billion in deposits, to three different buyers.
"We believe there are significant opportunities for the growth of our franchise in these markets as the banking sector and overall economy continues in its recovery," said Richard L. Carrión, Popular chairman, president and CEO. "Focusing our efforts on these markets will ultimately enable us to better serve and grow our customer base, while strengthening the capital position of both PCB and Popular."
The transactions will result in net premium of about $25 million and an estimated noncash Goodwill write-down of about $160 million.
The acquisition, subject to regulatory approvals and conditions, is expected to close before the end of 2014.