SPOKANE, Wash. — Sterling Financial Corp. of Spokane will merge with FirstBank NW Corp. of Clarkston, the two institutions said Monday.
The $169.6 million deal is expected to close in the fourth quarter of 2006, pending FirstBank shareholder and regulatory approval.
Savings from merging the two institutions will be derived primarily from consolidations of back office operations and other operating expenses. Sterling expects to consolidate branches in some locations, but will avoid staff reductions, Sterling said.
The merger was unanimously approved by the boards of both companies.
Under the deal, each share of FirstBank common stock will be converted into the right to receive 0.7890 shares of Sterling common stock and $2.55 in cash.
The combined company will have approximately $9.2 billion in total assets, deposits of approximately $6.1 billion and loans of $6.3 billion.
"FirstBank is a superb strategic fit for Sterling in terms of geography, demographics and client service philosophy, and represents a unique opportunity to expand our community banking franchise in our home markets," said Harold B. Gilkey, chairman and CEO of Sterling.
"We believe this combination is positive for FirstBank's customers, shareholders and employees," said Clyde E. Conklin, president and CEO of FirstBank.
Sterling has financial service centers throughout Washington, Oregon, Idaho and Montana. Through its subsidiaries, Action Mortgage Co. and INTERVEST-Mortgage Investment Co., it operates loan production offices in Washington, Oregon, Idaho, Montana, Arizona, Utah and California.
FirstBank NW Corp. is a savings and loan holding company for FirstBank Northwest, which offers various banking services in Washington, Idaho and Oregon. Currently, FirstBank operates eight depository offices in Idaho, three in Washington and nine in Oregon.