Cascade Financial Corporation ("Cascade Financial") (Nasdaq:CASB),
parent company of Cascade Bank, today announced that Cascade
Financial, Cascade Bank (the "Bank") and Opus Bank, Irvine, CA,
have entered into a definitive agreement, providing for Opus Bank
to acquire Cascade Financial and its principal operating
subsidiary, Cascade Bank, and for the merger of Cascade Bank into
Opus Bank. According to the terms of the agreement, Opus Bank will
pay approximately $16.25 million to retire Cascade Financial's $39
million in preferred stock and associated warrants issued to the
United States Department of the Treasury under the Treasury's
Capital Purchase Program, and $5.5 million in cash to the holders
of Cascade Financial's common stock. The purchase price for
Cascade Financial's common stock represents approximately $0.45
cash per share outstanding. In addition, Opus Bank will assume all
of Cascade Financial's obligations with respect to trust preferred
securities issued by Cascade Financial's trust subsidiaries.
Since July of 2010, Cascade Bank has been operating under a
Consent Order with the FDIC under which Cascade Bank is required to
increase its capital ratios. As of December 31, 2010, Cascade
Bank required approximately $68 million in new capital to meet the
minimum Tier 1 leverage ratio requirement of 10% under the Consent
Order. Since late 2009, Cascade Financial's Board and
management team have been reviewing alternatives to improve the
bank's capital position with the assistance of its financial
advisor, Sandler O'Neill + Partners LP, a nationally recognized
investment banking firm and expert in the banking industry. As
part of its review, the Board of Directors considered a range of
alternatives including potential capital infusions from private
investors and financial institutions, strategic combinations and
private equity transactions, and actively solicited offers from
potential investors and acquirers. The definitive merger
agreement with Opus Bank was unanimously approved by the Boards of
Directors of Cascade Financial, Cascade Bank and Opus Bank.
As a result of the proposed transaction, Cascade Bank expects to
benefit from Opus Bank's strong capital position. Last year,
Opus Bank successfully completed a recapitalization, infusing a
total of $460 million of new capital into the bank. Opus
Bank's growth goals include the creation of a strong super-regional
banking franchise in the Western United States, encompassing the
states of Washington, Oregon, California, Arizona and Nevada.
"The economic recession severely impacted the Snohomish County
area and Cascade Bank," said Carol K. Nelson, President and
CEO. "After carefully considering all options, the Board of
Directors and management determined Cascade Bank needed to
substantially increase its capital base to meet regulatory
requirements and remain competitive, and a merger with Opus Bank
was the best option for our shareholders, customers, and
employees. We share many strategic and cultural goals with
Opus Bank, and by joining forces we will be able to continue to
serve our communities and support the economy of the State of
Washington. In this economic environment, a strong and
well-capitalized multi-billion dollar community bank can have a
significant impact on a region's economy. Opus Bank holds a very
clear vision of rebuilding communities and their economies, by
providing businesses and entrepreneurs the much needed capital
funding that they can use to invest in their businesses, increase
staffing and grow. Opus Bank's focus on increasing the capital
funding in the communities it serves and the support it provides to
those communities are in line with Cascade's culture and long
heritage."
Stephen H. Gordon, Chairman, Chief Executive Officer and
President of Opus Bank stated, "I deeply believe that strong and
well-capitalized financial institutions need to step up and
immediately have a positive impact on our local economies, thereby
leading the economic turnaround. Opus Bank intends to do its
part by infusing capital funding and liquidity back into its local
economies. This infusion of capital will be a driving force
for creating new jobs and rebuilding healthy and vibrant
communities." Gordon added, "We look forward to welcoming Cascade's
218 employees to the Opus Bank team when we receive all required
approvals and close the transaction. With its highly-respected team
of experienced bankers, 22 banking offices in the Puget Sound and
Seattle metropolitan region, and amongst the highest capital ratios
of banks in the Western region, Opus Bank will enable small and
mid-sized businesses, real estate investors, entrepreneurs, and
individuals who share our vision to build and expand, to have
access to the capital to do so, thereby helping to turn around the
region's economy."
Cascade Financial, headquartered in Everett, Washington, had
total assets of $1.5 billion and total deposits of $1.1 billion at
December 31, 2010. Cascade Financial was advised in this
transaction by Sandler O'Neill + Partners, LP and the law firm of
Keller Rohrback LLP based in Seattle. The merger is subject to
the approval of Cascade Financial Corporation's shareholders, the
approval of federal and state regulatory authorities, and other
customary conditions. The parties expect to close the transaction
in the latter part of the second quarter of 2011.
In connection with the proposed transaction, Cascade Financial
will prepare and file with the Securities and Exchange Commission
("SEC") a Proxy Statement related to the special meeting of
stockholders it intends to call to solicit stockholders' approval
of the merger agreement and the transactions provided for
therein. Shareholders are urged to read the Proxy Statement
regarding the merger transaction when it becomes available and any
other relevant documents filed with the SEC, as well as any
amendments or supplements to those documents, because they will
contain important information. A free copy of the Proxy
Statement, as well as other filings containing information about
Cascade Financial, may be obtained at the SEC's Internet site
(http://www.sec.gov). You will also be able to obtain these
documents, free of charge, from Cascade Financial at
www.cascadebank.com under the tab "Investor Relations".
About Cascade Financial
Established in 1916, Cascade Bank, the only operating subsidiary
of Cascade Financial, is a state chartered commercial bank
headquartered in Everett, Washington. Cascade Bank maintains
an "Outstanding" CRA rating and has proudly served the Puget Sound
region for over 90 years. Cascade Bank operates 22 full
service branches in Everett, Lynnwood, Marysville, Mukilteo,
Shoreline, Smokey Point, Issaquah, Clearview, Woodinville, Lake
Stevens, Bellevue, Snohomish, North Bend, Burlington and
Edmonds.
In November 2010, Cascade Bank was named Favorite Snohomish
County (with fewer than 250 employees) in NWJobs.com's People's
Picks campaign for the second year in a row. In April 2010,
Cascade was ranked #8 on the Puget Sound Business Journal's list of
largest bank companies headquartered in the Puget Sound
area.
About Opus Bank
Opus Bank is an FDIC insured California state-chartered
commercial bank with $693.5 million of total assets, $104 million
of total loans, $275.3 million in total deposits, and $414.2
million of total equity, as of December 31, 2010. Opus Bank
provides high value, relationship-based banking products and
exceptional service to its clients comprised of small and mid-sized
commercial businesses, entrepreneurs, real estate investors,
high-net-worth individuals, professionals, and consumers. Opus Bank
offers a wide range of loan products, including commercial and
industrial, commercial real estate, multifamily residential, jumbo
single-family residential, construction, consumer loans, and is a
Small Business Administration ("SBA") Preferred Lender. Opus Bank
currently operates banking offices in Los Angeles County, CA
located in the communities of Manhattan Beach, Redondo Beach,
Rancho Palos Verdes/San Pedro, Rolling Hills Estates, and Torrance,
and maintains an executive and administrative office in Irvine,
located in Orange County, California. For additional
information about Opus Bank, please visit our Web site at
www.opusbank.com.
Forward-Looking Statements
This press release contains forward-looking statements. Any
statements about our expectations, beliefs, plans, predictions,
forecasts, objectives, assumptions or future events or performance
are not historical facts and may be forward-looking. These
statements are often, but not always, made through the use of words
or phrases such as "anticipate," "believes," "can," "could," "may,"
"predicts," "potential," "should," "will," "estimate," "plans,"
"projects," "continuing," "ongoing," "expects," "intends" and
similar words or phrases. Accordingly, these statements are
only predictions and involve estimates, known and unknown risks,
assumptions and uncertainties that could cause actual results to
differ materially from those expressed in them. Our actual
results could differ materially from those anticipated in such
forward-looking statements, including as a result of factors
outside Opus Bank's or Cascade Financial's control, such as
economic and other conditions in the markets in which Opus Bank and
Cascade Financial operate; inability to complete the transaction
announced today; managements' ability to effectively execute their
respective business plans, including any changes in management or
employees; regulatory enforcement actions to which Cascade
Financial and Cascade Bank are currently and may in the
future be subject; changes in capital classification; changes in
the economy affecting real estate values; inability to attract and
retain deposits; changes in the level of non-performing assets and
charge-offs; changes in the financial performance and/or condition
of borrowers; inflation, interest rate, cost of funds, securities
market and monetary fluctuations; changes in laws and regulations;
and competition. All forward-looking statements are
necessarily only estimates of future results, and there can be no
assurance that actual results will not differ materially from
expectations, and, therefore, you are cautioned not to place undue
reliance on such statements. Further, any forward-looking
statement speaks only as of the date on which it is made, and we
undertake no obligation to update any forward-looking statement to
reflect events or circumstances after the date on which the
statement is made or to reflect the occurrence of unanticipated
events.
CONTACT: Investor Contacts:
Carol K. Nelson, CEO
Debra L. Johnson, CFO
Cascade Bank
425.339.5500
www.cascadebank.com
Media Contacts:
Paul Kranhold / Diane Henry
Sard Verbinnen & Co
415.618.8750
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