PHOENIX—$1.7-billion Arizona FCU plans to acquire $236-million Pinnacle Bank of Arizona, based in Scottsdale, the CU reported.
“The integration of Pinnacle Bank’s core competencies in the real estate and commercial lending areas, with Arizona Federal’s core competencies in the area of individual and personal finance will create significant long-term value for all our stakeholders,” explained Ronald Westad, president and CEO of Arizona Federal. “We’re excited to expand our value proposition to our current members, and we’re equally excited to welcome Pinnacle Bank clients as new members.”
Arizona Federal considered the skills and experience of the Pinnacle Bank employees as a critical component of the acquisition, the CEO said. “No jobs will be lost as a result of the transaction,” Westad said. Arizona Federal intends to hire all Pinnacle Bank employees and maintain all four branch locations, AZ Big Media reported.
“Pinnacle Bank employees will join together with Arizona Federal employees, sharing a commitment to deliver financial services and expertise to families and small businesses through the communities we serve,” said Michael J. Thorell, chairman and CEO of Pinnacle Bank.
The transaction, which is subject to regulatory and shareholder approval, has been unanimously approved by the boards of directors of both institutions, and is expected to be completed in the fourth quarter of 2019.
The combined organization will have more than $1.8 billion in assets, and serve over 127,000 members at 16 locations throughout the state.
Arizona Federal was advised by Michael Bell, attorney and counselor Royal-Oak, Mich.-based Howard & Howard, who has pioneered these transactions and has been involved in a great majority of CU/bank deals.
“I’m pleased to get a transaction going in the Southwest,” said Bell. “This proves the relevance of these deals nationwide. This is a strong transaction for AZFCU, excellent non-organic growth.”
The deal continues the recent trend of credit unions buying larger banks, and those that are profitable, Pinnacle made $2.1 million in 2017 and $621,000 in 2018, according to FDIC data.