Finance and Thrift Company and Pan American Bank to Merge

F&T and Pan American will merge in an all-stock transaction; combined entity will operate under Pan American name

Transaction provides expanded service offerings; enlarged geographic penetration; economies of scale to reduce overhead costs; enhanced long-term shareholder value

PORTERVILLE, Calif. and LOS ANGELES, Feb. 26, 2015 (GLOBE NEWSWIRE) -- Finance and Thrift Company (F&T), a wholly owned subsidiary and the principal operating unit of F&T Financial Services, Inc. (OTCQB:FTFS), and Pan American Bank (OTCQB:PAMB) today announced the signing of a definitive agreement to merge in an all-stock deal. Terms were not disclosed.

The transaction, which is subject to customary closing conditions, including regulatory approval and approval by shareholders of Pan American and the stockholders of F&T Financial Services, is expected to close in the next 90 to 120 days. Upon the closing, the combined entity will operate under the Pan American name, and the F&T Financial Services holding company will be liquidated. Boards of Directors of both organizations have approved the transaction. The headquarters of the merged institution will be in Los Angeles.

F&T and Pan American are both certified as Community Development Financial Institutions (CDFIs) and designated Minority Depository Institutions (MDIs), serving low-to-moderate (LMI) income consumers and businesses. They have focused on the Hispanic community for over half a century and will continue to do so.

On a pro forma consolidated basis, the combined entities will have approximately $161 million in assets, deposits of $121.5 million, and total tangible equity of $35.9 million, equal to 22.28% of total tangible assets. Pan American shareholders, on a pro forma basis, will own approximately 11% of the combined company, with 89% owned by F&T Financial Services stockholders.

Upon completion of the transaction, the Board of Directors will include six members of the current F&T and F&T Financial Services boards; Robert W. Hughes, President and CEO of F&T, who also will be appointed President and CEO of the merged bank; and two directors being appointed by Pan Am. Robb Evans, of REA Consulting LLC, has served as Chairman of the Board and interim Chief Executive Officer of Pan American Bank since it was recapitalized by 17 community banks in a stock offering in July 2014.

"The merger of our two banks will create a unique and valuable franchise, achieving meaningful economies of scale, expanding our revenue streams and enhancing long-term shareholder value, while more effectively serving the needs of under-banked consumers and communities across a broader geographical scope, including the Central Valley and Southern California," Hughes said. "We also will be able to provide additional services, including auto and consumer finance loans, along with micro-loans to consumers and small businesses, and diversify our balance sheet. Additionally, regulation and compliance will be simplified, since the new Pan American will operate as a California chartered commercial bank."

Hughes said plans call for the opening of a new Pan American branch operation later this year in the north San Fernando Valley, as part of a strategic goal of expanding into select Los Angeles markets with significant Hispanic and low-to-moderate income consumers.

Mona A. Bañuelos, long time Pan American Bank board member and daughter of the bank's founder, said, "We are proud of our history and what we have built since Pan American's inception fifty years ago. My mother's great legacy, in addition to being United States Treasurer, was to provide this institution to the community. As a result of this merger, we will continue to foster our mission of serving low-to-moderate income families and the Hispanic community in California with an even greater array of services. We look forward to continuing to help improve the quality of life and be an active participant in the communities we serve, including expanding our successful program of promoting financial literacy."

F&T is advised by MJ Capital Partners, LLC as its financial advisor and by the law firm of Manatt, Phelps & Phillips, LLP as its legal counsel; Pan American Bank was advised by the law firm of Horgan, Rosen, Beckham & Coren, LLP.

About F&T

Originally established in 1925, F&T currently operates in the Central Valley of California from headquarters in Porterville, with branch offices in Bakersfield, Visalia, Fresno and Modesto. The bank provides a full complement of prime and near-prime, small-balance personal and auto loans and small-business/commercial loans, along with savings and money market accounts and certificates of deposits. For more information about F&T, visit

About Pan American

Pan American Bank was founded in 1964 by Romana Acosta Bañuelos, the first Latina Treasurer of the United States, to serve under-represented and under-served consumers and small businesses of East Los Angeles. Pan American, which currently operates one banking office, offers a wide range of financial services for consumers and small businesses and maintains a fully-bilingual staff (English/Spanish). As California's oldest and America's second oldest Latino bank, Pan American is nationally recognized as a leading community bank based on its advocacy-based style of banking. For more information about Pan American, visit

Forward-looking statements

This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such statements, including, but not limited to, the occurrence of any event, change or other circumstance that could give rise to the termination of the definitive agreement; the anticipated completion time to close the transaction; expected pro forma results; and the creation of opportunities for future growth and added shareholder value, are subject to risk and uncertainty. Actual results could differ materially due to various factors. Undue reliance should not be placed on forward-looking statements, and the companies undertake no obligation to update any such statements to reflect circumstances or events that occur after the date on which the forward-looking statements are made.

CONTACT: For more information, contact: Roger Pondel/George Medici PondelWilkinson Inc. 310-279-5980 investor@pondel.comSource: Finance & Thrift