RBB Bancorp acquires Gateway Bank for $ 22.9 million

RBB Bancorp has entered into a definitive agreement to acquire Gateway bank in a cash transaction valued at approximately $ 22.9 million, subject to certain terms and conditions, including customary holdbacks if certain contingencies are not met and other possible adjustments as contained in the Final Agreement.

Gateway Bank, a commercial bank based in Oakland, Calif., Had total assets of $ 172.4 million, total gross loans of $ 123.1 million, total deposits of $ 147.5 million, and equity. total tangible assets of $ 15.5 million as of September 30. communities in the San Francisco Bay Area, Gateway Bank has a branch located in the Chinatown neighborhood of Oakland, offering banking and lending products and services to individuals and businesses.

RBB Bancorp is a community-based financial holding company headquartered in Los Angeles and operating through its wholly owned subsidiary, Royal Business Bank.

“We are very pleased to announce this transaction with Gateway Bank and our entry into the San Francisco Bay Area,” said Alan Thian, President and CEO of RBB Bancorp. “Expansion into the Bay Area, with one of the largest Asian-American communities in the United States, has long been one of our goals. We are excited to enter this market and bring our relationship-based banking model to the Bay Area. “

“With our acquisition of Gateway Bank, Royal Business Bank will have a physical presence in six of our nine target markets,” said Dr James Kao, President of RBB Bancorp. “Gateway Bank provides a profitable base from which to continue our growth in the Bay Area. “

“After 31 years serving the Chinatown community of Oakland and the wider Bay Area as an independent community bank, we are thrilled with the opportunity to join the Royal Business Bank,” said Glen Terry , CEO of Gateway Bank. “We believe their community banking model, culture and commitment to high quality customer service make Royal Business Bank a great partner for Gateway Bank.”

Under the definitive agreement, RBB Bancorp will pay approximately $ 22.9 million in cash to shareholders of Gateway Bank. RBB Bancorp expects the transaction to generate earnings per share in 2022 in the mid single-digit range. RBB Bancorp also expects to experience a tangible book value per share dilution of approximately 1.8% upon closing, with a payback period of the tangible book value dilution of approximately 1.8%. year. Estimates for increased earnings per share are based on estimated cost savings of around 60% of Gateway Bank’s non-interest charges, with the cost savings being phased in over 2022. Estimates by Increased earnings per share do not include any assumption of revenue synergies. The transaction is expected to close in Q2 / 22 and is subject to RBB Bancorp obtaining all regulatory approvals as well as other customary closing conditions.

The Findley Group acts as financial advisor to RBB Bancorp and Loren P. Hansen acts as legal advisor to RBB Bancorp. Janney Montgomery Scott acts as financial advisor to Gateway Bank and Godfrey & Kahn acts as legal advisor to Gateway Bank.

Shawanda H. Saldana