California
California banks to combine in $234 million 'merger of equals'
Southern California Bancorp in San Diego and Oakland-based California BanCorp said they would merge in a $233.6 million, all-stock deal that would create a combined company with $4.6 billion of assets
The $2.4 billion-asset
However, the transaction, slated to close in the third quarter, would give Southern California Bancorp shareholders 57.1% ownership of the outstanding shares of the combined company. California BanCorp investors would own the rest. The deal consideration was based on Southern California Bancorp’s Jan. 29 closing stock price.
The merged bank would be based in San Diego and also cover Greater Los Angeles and the San Francisco Bay Area.
It marked the second large bank deal to date in the West in the new year. Seattle-based HomeStreet in mid-January said it
The transactions come on the
Jon Winick, CEO of bank consultancy Clark Street Capital, said the M&A headwinds “continue to blow” early in 2024. But he also said the economy has proven resilient and in growth mode, and this could give more bank executives confidence to jump back into the deal fray as community lenders need to bulk up to compete with larger peers.
The California banks said Tuesday their merger would unite two institutions that focus on middle market lending with complementary footprints, creating scale needed to further invest in technology and better manage risk, increase efficiency and provide customers with more products and services.
“Our two companies share the same vision and values with a customer-centric focus on providing outstanding service to mid-market businesses. We believe this combination, resulting in increased size and scale, will drive improved profitability and increase shareholder value,” David Rainer, chairman and CEO of Southern California Bancorp, said in a press release announcing the deal.
“It also offers customers increased product offerings and lending limits, as well as access to branches in both Northern and Southern California. The merger will also provide employees of both companies with increased career opportunities,” he added.
Rainer would become executive chairman of the combined parent company and bank as well as the boards of both.
Steven Shelton, CEO of California BanCorp, would assume that title of the merged company and bank. He would also be a director.
“The expanded scale and capabilities we will have as a result of this merger will enhance our ability to continue adding attractive full banking relationships with commercial clients that provide operating deposit accounts and high quality lending opportunities,” Shelton said in the release. The deal also would create opportunities to “move up market and work with larger businesses.”
The combined company’s board would consist of six directors from both banks. A lead independent director would be appointed after closing.
Additionally, Richard Hernandez, president of Southern California Bancorp, would retain that title post-merger.
Thomas Sa, who is president, chief financial officer and chief operating officer of California BanCorp, will serve as COO of the combined company and bank.
Thomas Dolan, CFO and COO of Southern California Bancorp, will serve as CFO of the combined company and chief strategy officer of the bank.
The companies said they would evaluate rebranding with new names and logos at the close of the transaction. The combined company’s common stock would continue to trade on the Nasdaq Capital Market.
The merged company’s Southern California footprint would include Bank of Southern California’s 13 branches that serve Los Angeles, Orange, San Diego and Ventura counties, as well as the Inland Empire of California. Its Northern California territory would include the California Bank of Commerce branch in Contra Costa County and its four loan production offices serving Alameda, Contra Costa, Sacramento and Santa Clara counties.
It would have $2.6 billion of loans and $3.8 billion of deposits.
The companies estimated the deal would create cost savings equal to about 15% of their combined noninterest expense base. They expect one-time, pre-tax merger expenses of $19.5 million.
They also projected 2025 earnings per share accretion of 48%. They expect to earn back tangible book value dilution of 18% in less than three years.
Redwood Valley, Calif. — A 5.6 magnitude earthquake shook Northern California on Wednesday morning, according to the U.S. Geological Survey.
The quake was centered 7 miles north of Redwood Valley in Mendocino County, north of Ukiah, and east of Highway 101. It had a depth of 5.0 miles.
A ShakeAlert notification went off on many people’s phones moments before the earthquake hit at 8:10 a.m., initially forecasted as a 6.1 magnitude quake by the U.S. Geological Survey (USGS) and downgraded moments later.
People across Northern California felt the quake. Reports came in from as far away as Eureka, Redding, Sacramento, and the Bay Area. Most people reported light to moderate rolling and shaking.
Since the initial quake, several aftershocks have hit the same area. Three smaller quakes between 2.6-2.7 magnitude were detected in the same area between 8:17 a.m. and 9:06 a.m., and are expected to continue.
So far, there have not been any reports of major damage or injuries.
—
BE THE FIRST TO COMMENT
Report a correction or typo.
California
DOJ charges 10 Southern California defendants in largest federal healthcare fraud crackdown in US history
Laura Ingraham: Fraudsters beware!
The Department of Justice announces the largest healthcare fraud takedown in U.S. history, charging 455 defendants across 45 states. They allegedly stole $6.5 billion from Medicare and Medicaid through wound care schemes and other fraudulent claims. Some funds were used for luxury homes and vehicles like a $135,000 Maserati.
NEWYou can now listen to Fox News articles!
Federal authorities on Tuesday charged 10 Southern California defendants in a series of healthcare fraud schemes, including one case involving nearly $270 million in fraudulent Medi-Cal claims and another that allegedly defrauded Medicare out of approximately $27 million.
The charges were part of the Justice Department’s broader “2026 National Health Care Fraud Takedown,” which resulted in charges against 455 defendants nationwide in schemes involving more than $6.5 billion in alleged fraud.
Acting Attorney General Todd Blanche described the operation as “the greatest combined federal and state effort in combating healthcare fraud in history.”
“Fraudsters can no longer rip off American taxpayers,” Blanche said during a news conference announcing the initiative. “If you seek to harm or cheat Americans, we will find you, seize any assets and prosecute you to the fullest extent of the law.”
FBI ADDS 2 FUGITIVES TO ‘MOST WANTED FRAUDSTERS’ LIST AMID HISTORIC $6.5B HEALTHCARE TAKEDOWN: PATEL
Acting Attorney General Todd Blanche speaks during a news conference announcing what federal officials described as the largest healthcare fraud takedown in U.S. history, resulting in charges against 455 defendants nationwide. (Ken Cedeno / AFP via Getty Images)
In the Central District of California, federal prosecutors brought criminal charges against 10 defendants accused of defrauding government-funded healthcare programs or abusing their positions as medical professionals to illegally prescribe controlled substances.
The U.S. Attorney’s Office for the Central District of California said five individuals were arrested in the greater Los Angeles area for allegedly participating in a scheme that involved submitting nearly $270 million in fraudulent claims to Medi-Cal for expensive prescription drugs.
Among those charged was Christina Mareik, 61, also known as Christina Marie Sanchez Hernandez, of Whittier.
HOSPICE FRAUD USES STOLEN IDENTITIES FOR FAKE PATIENTS
The Justice Department announced charges against 10 Southern California defendants in connection with multiple healthcare fraud schemes. (Department of Justice)
Prosecutors allege Mareik helped facilitate fraudulent prescriptions that generated nearly $270 million in claims to Medi-Cal, which ultimately paid out more than $178 million.
According to prosecutors, the claims involved expensive drugs containing low-cost generic ingredients that were either not medically necessary or were never provided to the purported recipients.
Authorities said Mareik also sent thousands of fraudulent prescriptions to a co-conspirator and caused the submission of fraudulent prescriptions under her own name.
LOS ANGELES HOSPICE FRAUD REACHES BILLIONS AS MEDICARE PROVIDERS SCAM FEDERAL SYSTEM WITH FAKE COMPANIES
Federal prosecutors allege Southern California defendants participated in schemes that defrauded Medicare and Medi-Cal of hundreds of millions of dollars. (Department of Justice)
Mareik was arrested June 17 and charged with healthcare fraud.
The charges also include a San Fernando Valley man accused of operating hospice care companies that fraudulently billed Medicare approximately $27 million, according to prosecutors.
Prosecutors also charged Oren David Shachar, 59, of Van Nuys; Abraham Shin, 66, of Corona; and Jeannie Choi, 57, of Torrance.
The three defendants face a 16-count indictment alleging they conspired to defraud Medicare out of approximately $27 million.
CLICK HERE TO DOWNLOAD THE FOX NEWS APP
The charges include conspiracy to commit healthcare fraud, healthcare fraud, aggravated identity theft, monetary transactions involving criminally derived property exceeding $10,000, and violations of the Anti-Kickback Statute.
Fox News Digital’s Alexandra Koch contributed to this report.
The IPOs of SpaceX, OpenAI and Anthropic could deliver billions of dollars to California’s coffers.
We’ve seen this movie before.
In 2022, California recorded a nearly $100 billion surplus, saved just $10 billion in its rainy day fund and then spent the rest. Two years later, a $56 billion deficit loomed.
Now, with the state facing ongoing operating deficits of more than $10 billion, we’re back in familiar territory.
The coming IPO windfall is a rare second chance. But we’ll only benefit from it if we first fix the structural flaw that’s caused us to squander every previous boom — a budget reserve that isn’t built to hold what we put in it.
The stakes this time are higher than ever. The war in Iran raised recession risk, and the federal government is systematically dismantling the funding streams California has depended on for decades.
When Washington retreats, Sacramento has to choose: cut services, raise taxes or have enough saved to bridge the gap. Right now, we don’t have enough saved.
We’re not outside observers wringing our hands. We helped shape the fiscal architecture the state is now straining against, and we’re here to say: It needs to be rebuilt.
As California state controller, one of us campaigned alongside Gov. Arnold Schwarzenegger to pass Proposition 58 in 2004 — creating California’s first Budget Stabilization Account. The other authored the Assembly Constitutional Amendment that became Proposition 2 in 2014 — the stronger, harder-to-raid replacement that voters approved with 69% support.
California’s tax system is the envy of progressive states and the nightmare of budget directors. We tax the wealthy at high rates, capture enormous capital gains revenue in boom years and then discover — every single time — that the peak doesn’t last.
If California treats the IPO windfall from SpaceX, Anthropic and OpenAI as permanent revenue, our state would repeat exactly the mistake we made four years ago.
Gov. Gavin Newsom and Assemblymember Avelino Valencia have each proposed important reforms to strengthen the fund. First, they call for requiring the state to make deposits until the fund reaches 20% of the general fund total, rather than the current 10%. Second, they propose changing an arcane accounting rule that treats saving for future downturns as spending.
We see one additional opportunity to make the rainy day fund even stronger.
If we want a larger budget reserve, we have to do more than merely allow it — we need to require it. Proposition 58 taught us everything we need to know on this front: Between 2004 and 2014, with that proposition fund in place, only two deposits were made. If we want consistent deposits during the boom times, they can’t be optional.
These reforms should be a win-win for the California Legislature. A larger reserve is the most durable protection that public sector workers, social service recipients and education advocates have against the kind of emergency cuts that have repeatedly gutted programs during downturns.
It’s also the strongest argument against tax increases in a recession because you don’t need to raise taxes if you actually save during the booms.
Building a stronger rainy day fund isn’t the cautious choice. It’s the visionary one — the closest thing we have to investing in the next generation of Californians.
We built the last rainy day fund because we’d lived through the consequences of not having one. We’re making the same argument again, for the same reason except now the stakes are higher. This time, the federal backstop is weaker, and the next storm is closer than it looks.
Fix the fund this year. The next generation of Californians will thank us for it.
Mike Gatto served in the state Assembly between 2010 and 2016, and he authored the measure that created California’s current rainy day fund. Steve Westly served as state controller between 2003 and 2007, and he co-championed Proposition 58, California’s original rainy day fund. Westly chairs the 21st Century Alliance, a nonpartisan organization focused on solutions to the state’s most pressing challenges.
-
Kentucky5 minutes agoKentucky’s Otega Oweh headed to Thunder in 2026 NBA Draft trade
-
Louisiana12 minutes agoGOP candidates trade attacks, differ on carbon capture in Louisiana Senate race
-
Maine15 minutes agoHearts of Pine halt 4-game skid with emphatic win
-
Maryland20 minutes agoRepublican candidates ask judge to block Maryland primary certification
-
Michigan27 minutes agoMichigan heatwave on way. See day likely to set a record high
-
Massachusetts30 minutes agoMassachusetts man accused of wanting sex with girl busted in World Cup trafficking operation
-
Minnesota35 minutes agoVance Boelter’s sentencing date set in deadly Minnesota lawmaker shootings
-
Mississippi42 minutes agoMississippi youth court law puts families' rights at risk, lawsuit says
