DCBK Desert Community Bank (MM)

PASADENA, Calif., April 24 /PRNewswire-FirstCall/ -- East West Bancorp, Inc. (NASDAQ:EWBC), parent company of East West Bank, one of the nation's premier community banks, and Desert Community Bank ("DCB") (NASDAQ:DCBK) announced today that they have signed a definitive agreement for the merger of DCB with East West Bank. DCB is a commercial bank headquartered in Victorville, California that operates nine branches in the High Desert area of San Bernardino County. "We believe that the merger will generate long-term value and earnings per share growth for our shareholders," stated Dominic Ng, Chairman, President and CEO of East West Bank. "Desert Community Bank is the only bank headquartered in the High Desert and has the largest market share in this region. The High Desert is a high growth area of Southern California with an increasing focus on international trade. This attractive market is thriving with small to middle market businesses -- the same types of businesses that are a focus for East West. Additionally, Desert Community Bank is an institution that shares the same fundamental values as East West -- a strong commitment to our customers, employees, shareholders and the community." Ronald L. Wilson, Chairman, President and CEO of Desert Community Bank, commented, "We are excited to partner with East West and believe that our customers and community will benefit from the resources of East West. The combined companies will allow High Desert residents and businesses to benefit from an expanded array of deposit and loan products and services." "Ron Wilson has done an outstanding job serving the High Desert community and businesses," added Ng. "The Desert Community Bank name will be maintained and Ron Wilson will continue to lead the DCB branches, which will operate as a division of East West." Under the terms of the definitive agreement, East West will acquire the outstanding shares of DCB for $24 per share, or an aggregate of approximately $142.6 million based on the 5,943,844 shares currently outstanding. The shareholders of DCB will receive 55% of the merger consideration in shares of East West common stock and the remainder in cash. The exchange ratio for determining the number of shares of East West common stock deliverable to shareholders of Desert Community will be based on the weighted average closing prices of East West's common stock over a 60 trading day measuring period ending five days prior to the closing. As of December 31, 2006, DCB had $532 million in total assets, $383 million in loans, $462 million in deposits, and $56 million in shareholders' equity. DCB's strength as a commercial bank is evidenced by core deposits of $395 million or 86% of total deposits and noninterest-bearing demand deposits of $156 million or 34% of total deposits at December 31, 2006. For the full year 2006, DCB's net interest margin was 5.73%, average yield on loans was 8.49% and average cost of deposits was 1.55%. The transaction has been approved by the boards of directors of both banks. The transaction is subject to customary conditions, will require the approval of banking regulators and DCB's shareholders, and is expected to be completed by the third quarter of 2007. The acquisition is estimated to be accretive to East West's earnings by about $0.01 during 2007 and $0.03 to $0.04 during 2008. About East West East West Bancorp is a publicly owned company, with $10.7 billion in assets, whose stock is traded on the Nasdaq Global Select Market under the symbol "EWBC." The company's wholly owned subsidiary, East West Bank, is the second largest independent commercial bank headquartered in Los Angeles with 60 branch locations. East West Bank serves the community with 58 branch locations across Southern and Northern California and a branch location in Houston, Texas. East West Bank has two international locations in Greater China, including a full-service branch in Hong Kong and a Beijing Representative Office in China. For more information on East West Bancorp, visit the company's website at http://www.eastwestbank.com/. About Desert Community Bank From its inception in March 1980, Desert Community Bank has been a leader in serving the needs of the communities in which it operates. That leadership is reflected by the involvement of DCB and its employees in the many civic and non-profit organizations that act as its partner in enhancing the quality of life for all. The success of the DCB's efforts in partnership with many community leaders is reflected in the growth of DCB to become the largest financial institution headquartered in the High Desert. DCB's nine full-service branches are located throughout the High Desert region of San Bernardino County, in the cities of Victorville, Apple Valley, Hesperia, Wrightwood, Adelanto, Barstow and Phelan. Shares of DCB's common stock are traded on the NASDAQ Global Market under the symbol "DCBK." To obtain a copy of any of DCB's public filings, or to obtain additional information, please visit DCB's website at http://www.dcbk.org/ or contact Ronald L. Wilson, President and CEO, or John G. Sullivan, Chief Financial Officer at (760) 243-2140. Forward-Looking Statements This release may contain forward-looking statements, which are included in accordance with the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and, accordingly, the cautionary statements contained in East West Bancorp's and Desert Community Bank's Annual Reports on Form 10-K for the year ended Dec. 31, 2006 (See Item I -- Business, and Item 7 -- Management's Discussion and Analysis of Consolidated Financial Condition and Results of Operations), and other filings with the Securities and Exchange Commission or the Board of Governors of the Federal Reserve System are incorporated herein by reference. These factors include, but are not limited to: the effect of interest rate and currency exchange fluctuations; competition in the financial services market for both deposits and loans; EWBC's ability to efficiently incorporate acquisitions into its operations; the ability of EWBC and its subsidiaries and DCB to increase their customer bases; the effect of regulatory and legislative action, including California tax legislation and an announcement by the state's Franchise Tax Board regarding the taxation of Registered Investment Companies; and regional and general economic conditions. Actual results and performance in future periods may be materially different from any future results or performance suggested by the forward-looking statements in this release. Such forward-looking statements speak only as of the date of this release. East West and Desert Community Bank expressly disclaim any obligation to update or revise any forward-looking statements found herein to reflect any changes in their expectations of results or any change in events. Participants in a Solicitation This release does not constitute an offer to sell securities or a solicitation of an offer to buy and does not constitute solicitation material in respect of the proposed acquisition of Desert Community Bank. In connection with the proposed transaction, East West and Desert Community will prepare a Proxy Statement/Prospectus containing all relevant disclosures which either will be filed with the SEC or, pursuant to an exemption, will be filed with the California Department of Corporations. SHAREHOLDERS OF DESERT COMMUNITY BANK ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT EAST WEST, DESERT COMMUNITY AND THE PROPOSED TRANSACTION. The Proxy Statement/Prospectus will be mailed to DCB's shareholders in advance of a special meeting of shareholders that will be held to consider the proposed transaction. Desert Community and its directors, executive officers and other members of its management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed acquisition. Information about the directors and executive officers of Desert Community and their ownership of DCB common stock is set forth in the Proxy Statement for Desert Community's 2007 Annual Meeting of Shareholders. Additional information regarding the interests of such participants in the proposed transaction will be included in the Proxy Statement/Prospectus, when it becomes available. FOR FURTHER INFORMATION: East West Bancorp Julia Gouw Chief Financial Officer (626) 768-6898 Desert Community Bank Ronald L. Wilson Chairman/CEO (760) 243-2140 DATASOURCE: East West Bancorp, Inc. CONTACT: Julia Gouw, Chief Financial Officer of East West Bancorp, +1-626-768-6898; or Ronald L. Wilson, Chairman/CEO of Desert Community Bank, +1-760-243-2140 Web site: http://www.eastwestbank.com/ http://www.dcbk.org/

Copyright