Mar 26, 2018

CVB Financial Corp. and Community Bank Announce Agreement to Merge

CVB Financial Corp. and Community Bank Announce Agreement to Merge
Highlights of Announced Transaction

  • Strengthens Citizens Business Bank’s (“Citizens”) presence in Southern California with greater than $12 billion in total assets on a pro forma basis
  • Citizens, founded in 1974, and Community Bank (“Community”), founded in 1945, are two institutions that have stood the test of time
  • Complementary business banking models with similar core values and corporate cultures
  • Expected to result in 12% earnings per share accretion in 2019, excluding one-time transaction costs

Ontario, CA and Pasadena, CA, February 26, 2018 - CVB Financial Corp. (Nasdaq: CVBF) and Community Bank (OTC Pink: CYHT) announced today that they have entered into an agreement and plan of reorganization and merger (the “Agreement”), pursuant to which Community will merge with and into Citizens in a stock and cash transaction valued at approximately $878.3 million, based on CVBF’s closing stock price of $23.37 on February 23, 2018. The merger will increase Citizens’ total assets to approximately $12.0 billion on a pro forma basis as of December 31, 2017.

CVBF expects the merger to result in approximately 12% earnings per share ac cretion in 2019, excluding one-time transaction costs. CVBF anticipates the merger to be approximately 11%dilutive to tangible book value per share at closing with an earn back period of approximately 4.9 years and an internal rate of return of greater than 15%. Additionally, at closing, MarshallV. Laitsch, Chairman of the Board of Community, will join the Board of CVBF.

Community Bank, headquartered in Pasadena, California, had approximately $3.7 billio n in total assets, $2.7 billion in gross loans and $2.9 billion in total deposits as of December 31, 2017.Community has sixteen branch locations throughout the greater Los Angeles and Orange County areas.

Christopher D. Myers, President and Chief Executive Officer of CVB Financial Corp. and Citizens Business Bank, stated, “We are excited to be merging with a successful business bank that has been built customer by customer for the past 74 years. Our combination with Community Bank provides us tremendous financial opportunity in terms of depth of talent, a strong and diverse customer base, and significant geographic overlap. We have truly admired this franchise for a long time. The reality of blending our two teams is very exciting.”

David R. Misch, Chief Executive Officer of Community Bank, commented, “We are delighted to be joining forces with an organization that so strongly complements and builds upon Community Bank’s long-standing tradition of customer, employee and community focus.”

Pursuant to the Agreement, each share of Community common stock, including unvested
restricted stock units, will receive a fixed consideration consisting of 9.4595 shares of CVBF
common stock and $56.00 per share in cash. CVBF will pay aggregate consideration of approximately 30.0 million shares of CVBF common stock and $177.5 million in cash, subject to purchase price adjustment provisions and other terms set forth in the Agreement. Giving effect to the merger, Community shareholders would hold, in aggregate, approximately 21.4% of CVBF’s outstanding common stock following the merger.

Upon completion of the merger, Community will operate as Citizens Business Bank and will continue to deliver the high-touch level of service that its customers expect, with an expanded branch and ATM network and a broad range of products and services, including expertise in personal, small business, private and corporate banking, as well as treasury management and trust services.

The boards of directors of Community, CVBF and Citizens have approved the proposed merger. The closing of the merger is subject to customary regulatory approvals and the approval of CVBF and Community shareholders, and is anticipated to occur in the third quarter of 2018.

For more information pertaining to the merge, please CLICK HERE.