PremierWest increases its branches in California

PremierWest Bancorp strengthened its Northern California holdings in a deal with Wells Fargo & Co. that will give the Medford-based bank as many California branches as it has in Oregon.

PremierWest acquired Wachovia Bank branches in Davis and Grass Valley from Wells Fargo.

"This gives us a pretty solid presence in the Sacramento area," said PremierWest Bank Chairman John Anhorn. "With those two branches, we go from being No. 15 in deposits in the Sacramento area to No. 9. In Davis, we're now the second-largest bank by deposits and the largest by deposits in Grass Valley."

Wells Fargo acquired Wachovia Corp. Dec. 31, and PremierWest assumed deposit liabilities of approximately $499 million with loans to be assumed of approximately $1 million in the deal.

The transaction is expected to close during the second quarter of this year.

The acquisition of offices in Davis and Grass Valley will mean half of PremierWest's 48 branches will be in California. The move boosts PremierWest's California deposits to approximately $974 million and total bank deposits to $1.7 billion.

As of Dec. 31, the Davis and Grass Valley branches had total deposits of approximately $251 million and $247 million, respectively.

Federal regulators required Wells Fargo to sell six of the 3,348 branches it bought from Wachovia — including deposits, loans and property — to buyers acceptable to the Federal Reserve.

Wells Fargo spokesman Tom Unger said three other California offices — in Monterey, Santa Cruz and Sonora — as well as in Canon City, Colo., have not been sold.

PremierWest said its capital levels will remain well in excess of regulatory minimums for "well-capitalized" institutions following closing of the transaction.

By Federal Deposit Insurance Corp. standards, a bank with a risk-based capital ratio of at least 8 percent is considered "adequately capitalized," and one with a ratio of at least 10 percent is considered "well-capitalized." The ratio measures a bank's total capital against its risk-weighted assets.

Assets such as cash, for instance, have less risk than a loan made without collateral.

PremierWest entered the Sacramento market in 2003 when it bought Mid Valley Bank and got a Woodland location. It also opened a new office in Roseville in 2006. And in 2007, PremierWest added five more local branches with the acquisition of Stockman's Bank, giving it branches in Elk Grove, Natomas, Folsom, Rocklin and Galt.

Reach reporter Greg Stiles at 776-4463 or e-mail

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