Spokane, Wash.-based AmericanWest Bank has acquired Escondido's Sunrise Bank for $18.5 million, ending a troubled chapter for the local bank that grew a healthy balance sheet over the past year as its financially ailing parent in Michigan struggled with a difficult turnaround. The deal would merge Sunrise into a newly created affiliate in California, called AmericanWest Bank. It is expected to close during its fiscal third quarter, pending regulatory and shareholder approvals, the banks said Thursday.
Sunrise parent Capitol Bancorp Ltd. has seen its balance sheet deteriorate rapidly in recent years. In trading Thursday, Capitol Bancorp's stock fell below 14 cents a share, down 2 cents. Back in its heyday of December 2006, prior to the Great Recession, the stock enjoyed a quarterly dividend of 25 cents and peaked at $47.49 a share.
Privately held AmericanWest, which has $1.6 billion in assets and deposits of $1.4 billion, has 58 branches in Washington, Idaho and Utah. With its foray into California with Sunrise, the holding company for AmericanWest has been on a buying spree, cobbling together banking assets since last fall under the helm of California banking veteran Scott A. Kisting.
In December, Kisting, who is chairman and chief executive of AmericanWest, formed SKBHC Holdings LLC to buy AmericanWest and other institutions. His holding company, made up of himself and other private investors, immediately infused $185 million of capital into AmericanWest. With an additional $500 million in funding commitments available through SKBHC, AmericanWest is focused on growing organically and through acquisitions.
Sunrise's four offices are in Escondido, Point Loma, Palm Desert and San Diego. This will be the second transaction between Capitol Bancorp and AmericanWest Bank, following a previous announcement of the proposed acquisition of Washington-based Bank of the Northwest just two weeks ago. Kisting, 64, has a 22-year banking career in California overseeing corporate and retail banking operations with Bank of America; Norwest Corp., which bought Wells Fargo in 1998; and California Federal Bank, which was sold a decade ago to Citibank. "It makes sense to be in California," Kisting said. "We looked at a lot of things and continue to do so. We liked the culture ... built here (at Sunrise) and normally never jump from Washington to nearly the Mexican border, but we feel it's such a good fit."