Wednesday, Sept. 9, 2009 | 9:10 a.m.
Global Consumer Acquisition Corp., the company working to buy small banks in Nevada, today announced its latest deal: The acquisition of Service1st Bank of Nevada.
Global is led by New York businessman and Las Vegas Sands Corp. board member Jason Ader. This summer it announced deals to acquire certain Nevada assets of Colonial Bank as well as 1st Commerce Bank of North Las Vegas.
Today's deal for Service1st brings longtime Nevada bankers Bill Martin and John Gaynor into the Global Consumer Acquisition organization. Global Consumer is expected to become Western Liberty Bancorp (WLB), a new bank holding company, following regulatory and shareholder approvals.
Service1st, launched in 2007, is closely held with about 200 shareholders. It had about $204 million in loans and other assets and about $159 million in deposits as of June 30. The company reported a six-month loss through June 30 of $1.2 million on interest income of $4.6 million. The results included a $963,000 provision for losses on loans and leases.
Service1st is expected to be purchased for Global Consumer stock, with the price to be negotiated based on Service1st's book value. The company as of June 30 reported equity of $41.3 million, but the purchase price may be adjusted downward from that number to reflect additional writedowns, Global Consumer Chairman Ader said today.
Ader said that a key positive in the deal is that Martin, former chief of Nevada State Bank, will become chief executive of Western Liberty while Gaynor will be its president.
"They're well-respected and accomplished,'' Ader said, adding they know the Nevada market and will help Global Consumer/Western Liberty with its plan to buy small and distressed banks in the state.
When the deal for 21 branches of Colonial Bank was announced in July, the plan was for Mark Daigle, CEO of Colonial's Nevada operations, to become CEO of Western Liberty's new 1st Commerce Bank.
But regulators closed Alabama-based Colonial Bank in August and it was taken over by North Carolina-based holding company BB&T, creating uncertainty for Global Consumer's acquisition of the Nevada operations.
It's unknown what role, if any, Daigle will play in the new Western Liberty. Ader called Daigle well-respected, but made clear the new Western Liberty will be led by Martin and Gaynor, the former CEO of Bank of Nevada.
Ader said Global Consumer is continuing to talk with BB&T about acquiring some of the former Colonial operations in Nevada and that Global Consumer continues to work on closing the purchase of 1st Commerce Bank.
"The acquisition of Service1st would be a model transaction for us, and we look forward to pursuing this together with the many similar opportunities that we expect to become available in the Nevada marketplace," Ader, also chairman of Western Liberty, said in a statement. "We are working to create a highly scalable regional bank led by premier management with a track record of creating shareholder value.
"We are incredibly excited that Bill Martin and John Gaynor would look to join WLB upon the consummation of such a transaction with Service1st. They are tremendously talented and well-respected Nevada bankers, and we expect they would be valuable additions to WLB."
Martin said in a statement: "This is tremendous for Service1st Bank, our shareholders and community. WLB’s strategy, working with our bank, opens the door for major opportunities for expansion and makes a huge statement about WLB’s confidence in the future of the Nevada economy."