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BofI Federal Bank acquires certain assets and assumes certain operations of Pacific Western Equipment Finance

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BofI Federal Bank acquires certain assets and assumes certain operations of Pacific Western Equipment Finance

San Diego-based BofI Federal Bank ($6.66 billion) on March 31 closed anasset purchase agreement in which it acquired certain assets and assumedcertain operations of Salt Lake City-based Pacific Western Equipment Financefrom Beverly Hills, Calif.-based Pacific Western Bank ($21.18 billion).

Specifically, the BofI Holding Inc. subsidiary acquired approximately $140million of equipment leases diversified across 36 states and Canada and over 50industries, according to an April 4 press release.

"Theseare generally small-ticket leases ranging from $250,000 to $5 million tomiddle-market companies with strong cash flows. We did not acquire the entirelease portfolio from Pacific Western Equipment Finance. All of the leases weacquired are current, and none of the leases are to companies in energy orenergy-related industries, nor are any of the assets or operations associatedwith CapitalSource Corporate Asset Finance Group," Bofl Holding ExecutiveVice President and Chief Finance Officer Andrew Micheletti said during a conferencecall on the acquisition April 4.

Michelettifurther disclosed, "We paid a purchase price premium of approximately 2.5%on the net book value of approximately 130 equipment leases with a weightedaverage rate of approximately 8%. We did not pay a premium on a very smallamount of fixed assets and other liabilities. The selected equipment leaseportfolio was purchased for cash. There was no debt assumed other than officeexpenses, and there is no other future consideration required to be paid."

Thebank will retain 25 existing employees, including Pacific Western EquipmentFinance's entire senior management team. The team will become a part of thebank's C&I lending group and will continue to conduct equipment lendingoperations at existing loan production and servicing office in Utah.

The transaction is expected to be accretive to BofI FederalBank's earnings per share within the first year post-closing, including thelease purchase price premium of approximately 2.5% and certain one-timeexpenses.

The current Pacific Western Equipment Finance managementteam operated independently as Marquette Equipment Finance from 2006 to 2012before being acquired by Pacific Western Bank in . Pacific Western Bank is asubsidiary of PacWestBancorp