The Federal Reserve has given the go-ahead to the acquisition of California-based SinoPac Bancorp by local lender Cathay General Bancorp and their subsequent merger.

Cathay General will also indirectly acquire SinoPac subsidiary Far East National Bank as part of the deal.

Cathay controls Cathay Bank that operates in California, Illinois, Nevada, New York, New Jersey, Maryland, Massachusetts, Texas, Washington, Hong Kong, Shanghai, and Taipei. SinoPac controlled-Far East Bank operates in California.

The deal, announced in July 2016, is valued at $340m. The merger of the two entities will lead to the creation of an entity with about $16bn in assets.