Broadway Financial and CFBanc (City First) have obtained the regulatory approvals to complete their ‘merger of equals’ transaction.
The US Office of the Comptroller of the Currency (OCC) greenlit the transaction on 24 December 2020, while the Federal Reserve of San Francisco approved the deal on 28 December.
Go deeper with GlobalData
Under the deal terms, City First will merge into Broadway, and Broadway will be the surviving entity.
Broadway’s subsidiary Broadway Federal Bank (BFB) will merge into City First’s subsidiary City First Bank (CFB), with CFB as the surviving bank.
As previously announced, City First’s shareholders will receive 13.626 shares of Broadway common stock for each City First share held, post-merger.
As a result, Broadway shareholders will own 52.5% of the combined entity, while the remaining stake will be owned by City First shareholders.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataBroadway’s private placement will be completed at a maximum proposed amount, resulting in the issuance of up to 12,720,000 shares at $1.78 per share.
Additionally, non-profit organisation and City First’s largest stockholder, the City First Enterprises, is entitled to own nearly 18.85% stake in Broadway pursuant to the merger.
Indirectly, the non-profit company will become the controlling stakeholder of BFB.
Upon transaction closing, the merger will create the largest black-led minority depository institution (MDI) in the US.
The new MDI will have over $1bn in combined assets under management (AUM) and nearly $900m in total depository institution assets as of September 2020.
Subject to the receipt of shareholders approvals, the merger is expected to be completed in the first half of this year.
Comments
CFB president and CEO Brian Argrett said: “The need for such an institution has been highlighted by the confluence of domestic social unrest, the global pandemic, and resulting pervasive unemployment that has occurred in 2020.
“Our management teams are continuing to work diligently to plan for a successful integration of the two organizations, and to obtain shareholder approval of the merger.”
Broadway CEO Wayne-Kent Bradshaw said: “We greatly appreciate the prompt review of the merger by all of the regulators involved with oversight of Broadway, City First, and our respective bank subsidiaries, and their assessments and determinations to approve the merger.
“These approvals are pivotal achievements in helping us create a combined institution with over $90m in equity capital and the capabilities to drive both sustainable economic growth and societal returns for the low-to-moderate income communities that we serve.”
