Opus Bank to buy Pensco Trust

Opus Bank said Monday it agreed to buy Pensco Trust Company from Pensco Services LLC. Terms of the deal call for Pensco shareholders to receive 1,698,529 shares of Opus Bank common stock and $47.25 million in cash. San Francisco-based Pensco Trust is a custodian of self-directed IRA and alternative investments with nearly $11 billion of custodial assets. Credit Suisse Securities (USA) LLC and Sandler O’Neill + Partners LP advised Opus Bank while Holland & Knight LLP was their attorney. Financial Technology Partners LP and FTP Securities LLC advised Pensco while Goodwin Procter LLP provided legal advice.


January 25, 2016 06:45 AM Eastern Standard Time

IRVINE, Calif.–(BUSINESS WIRE)–Opus Bank (“Opus”) (NASDAQ: OPB) announced today that it has entered into a definitive agreement to acquire PENSCO Trust Company (“PENSCO”), a wholly-owned subsidiary of PENSCO Services, LLC. PENSCO is a leading custodian of self-directed IRA and alternative investments headquartered in San Francisco, California. PENSCO has nearly $11 billion of custodial assets from over 45,000 clients and investments in over 40,000 unique asset types, comprised of private equity, real estate, notes, cash, and other non-exchange traded assets. Under the terms of the agreement, PENSCO shareholders and members will receive aggregate consideration comprised of 1,698,529 shares of Opus Bank common stock and $47.25 million in cash, subject to certain adjustments set forth in the definitive agreement. The transaction is expected to close early in the second quarter of 2016, subject to certain regulatory approvals or non-objections and approvals by PENSCO’s shareholders and members, after which PENSCO will operate as a subsidiary of Opus. PENSCO shareholders and members have entered into voting agreements which provide for the requisite approvals when special meetings are held to vote on the transaction. Kelly Rodriques, President and Chief Executive Officer of PENSCO, will continue in the role of President and Chief Executive Officer of PENSCO, and will join Opus as Executive Vice President-Wealth Services.


Stephen H. Gordon, Chairman, Chief Executive Officer and President of Opus stated, “I am excited to announce that PENSCO and its talented team will be joining Opus. We see tremendous benefit and opportunity between our companies, clients, and employees and I’m pleased we are announcing this important strategic transaction.” Gordon added, “Having banked PENSCO since early 2014, the Opus team has a strong understanding of PENSCO’s business and sector and views this synergistic transaction as part of the continued evolution, diversification, and sophistication of Opus. In addition to placing Opus squarely in the forefront of the alternative asset wealth services business, thereby adding a substantial new source of recurring non-interest income-based revenue and contributing approximately $1.0 billion of near-zero cost deposits on to Opus’ balance sheet, we believe that several other revenue opportunities will be realized between PENSCO and Opus in the future.” Gordon concluded, “We look forward to working with the PENSCO team and their clients, of which over 17,000 are domiciled within Opus’ West Coast footprint, in order to help them achieve their financial goals.”

Founded in 1989, PENSCO is a leading alternative asset custodian, with over 25 years of expertise in holding private equity, real estate, notes, cash, and other non-exchange traded assets. PENSCO is a preferred partner to some of the largest wealth advisor networks and other financial institutions, serving independent-minded investors seeking to put their retirement dollars to work in alternative assets. PENSCO is a premium fintech provider with highly scalable technology and an unmatched network of providers and third-party platforms. The PENSCO platform features leading deal automation technology as well as a service-oriented web platform and enterprise workflow engine that facilitate the initial investment and administering of the assets over their lifetime.

Kelly Rodriques, President of PENSCO, commented, “We are thrilled to join Opus Bank and are excited about the opportunities that the combined companies will create for our clients. This marriage of our growing and entrepreneurial firms is characterized by our shared institutional expertise and sharp focus on fintech innovation that will shape the future of financial services firms.” Rodriques concluded, “Investor interest in alternative assets continues to grow rapidly, and both Opus and PENSCO are at the forefront of interacting with multiple touch points in this space. Both companies share the vision of servicing clients’ alternative asset investing needs. The two firms already have similar clients – entrepreneurs, business owners, individual investors, private equity firms, and investments banks – and also have a common expertise in handling real estate, private equity and technology related assets. Together, our shared expertise enables an even greater focus on creating and delivering industry-leading technology platforms that simplify and expand the way investors and business owners create and manage their wealth.”

PENSCO will continue to operate and serve its clients as a subsidiary of Opus, providing Opus with strong, recurring non-interest income based on assets under custody. PENSCO has over $1.0 billion in near-zero cost cash balances deposited at FDIC insured depository institutions, which will be brought on to Opus’ balance sheet over a short transition period and contribute further growth and spread income to Opus. In addition, the teams at PENSCO and Opus will work to develop and realize future additional potential revenue opportunities through Opus’ Merchant Bank, Commercial Bank, Retail Bank, and Opus Financial Partners, Opus’ broker-dealer subsidiary.

Opus Bank was advised by Credit Suisse Securities (USA) LLC and Sandler O’Neill + Partners, L.P., with legal representation from Holland & Knight LLP.

Financial Technology Partners LP and FTP Securities LLC (together, “FT Partners”) served as exclusive strategic and financial advisor to PENSCO and its board of directors in this transaction. PENSCO received legal representation from Goodwin Procter LLP.

Opus has additionally filed a presentation highlighting this transaction in a Form 8-K.

Opus will host a conference call for investors and analysts at 8:00 a.m. Pacific Time (PT) on January 25, 2016 to discuss this transaction as well as its fourth quarter and full year 2015 financial results.

Conference Call Details
Date: Monday, January 25, 2016
Time: 8:00 a.m. PT (11:00 a.m. ET)

Phone Number (855) 265-3237
Conference Id: 12996069

About Opus Bank
Opus Bank is an FDIC insured California-chartered commercial bank with $6.6 billion of total assets, $5.5 billion of total loans, and $5.3 billion in total deposits as of December 31, 2015. Opus Bank provides high-value, relationship-based banking products, services, and solutions to its clients through its Retail Bank, Commercial Bank, Merchant Bank, and Correspondent Bank. Opus Bank offers a suite of treasury and cash management and depository solutions and a wide range of loan products, including commercial business, healthcare, technology, multifamily residential, commercial real estate, and structured finance, and is an SBA preferred lender. Opus Bank offers commercial escrow services and facilitates 1031 Exchange transactions through its Escrow and Exchange divisions. Opus Bank provides clients with financial and advisory services related to raising equity capital, targeted acquisition and divestiture strategies, general mergers and acquisitions, debt and equity financing, balance sheet restructuring, valuation, strategy, and performance improvement through its Merchant Banking division and its broker-dealer subsidiary, Opus Financial Partners. Opus Bank operates 58 client experience centers, including 33 in California, 22 in the Seattle/Puget Sound region in Washington, two in the Phoenix metropolitan area of Arizona, and one in Portland, Oregon. Opus Bank is an Equal Housing Lender.

Forward-Looking Statements
This press release contains “forward-looking statements.” These forward-looking statements include information, which is subject to change and subject to risks, uncertainties and assumptions. The forward-looking information presented in this press release is not a guarantee of future events, and actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “intend” or “expect” or variations thereon or similar terminology. All such statements speak only as of the date made, and Opus Bank undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.