Executivesat Los Angeles-based Cathay GeneralBancorp said the company expects cost savings of up to 60% from itsjust-announced $340 milliondeal to acquire SinoPac Bancorp.
CathayChairman, President and CEO Dunson Cheng also outlined a trans-Pacific strategicpartnership with Bank SinoPac Co.Ltd., the current parent company of L.A.-based SinoPac. Cathay willissue stock equal to 10% of the purchase price in the deal to SinoPac and the sideswill continue to help each other's clients with international banking needs.
"Theplan is to partner with Bank SinoPac to make it convenient for our customers todo business in Asia, and vice versa," Cheng said during a conference call todiscuss the deal.
Chengtold analysts and investors on the call that the transaction was a low-risk wayto put Cathay's excess capital to use and boost its growth prospects.
Companyexecutives said they expect to realize substantial cost-savings — about 60% of 's noninterestexpense base — because SinoPac is an in-market target, according to Cathay's executivevice president, treasurer and CFO, Heng Chen.