The transaction, which is expected to close in the first half of 2018, involves approximately $600 million in deposits and $70 million in loans and related assets. Terms of the transaction were not disclosed. It is subject to regulatory approval and customary closing conditions.
"I would like to welcome the Desert Community team to the Flagstar family," Flagstar Bancorp President and CEO Alessandro DiNello said. "We've been looking to acquire a high-quality deposit franchise, but they've been difficult to find. The Desert Community branches fit the bill.
"The acquisition provides low-cost, stable funding to continue growing our balance sheet,” DiNello said. “It also combines a successful deposit franchise with a significant Flagstar presence already on the West Coast, including our Opes Advisors division and warehouse lending and home builder financing activities. Expanding our deposit franchise into California made a lot of sense because it's a state where we already do significant business.”
Flagstar Bank also recently launched a homeownership program aimed at assisting low- to moderate-income borrowers and borrowers in low- to moderate-income areas throughout Michigan.
Under the program, Flagstar Bank will provide the required 3% down payment as well as up to $3,500 in closing costs as a gift. Qualified borrowers will not be obligated to repay the down payment.
“Two of the biggest hurdles to homeownership are saving money for a down payment and then being able to afford the closing costs,” said Beverly Meek, CRA director at Flagstar Bank. “This program takes on both head on and opens up opportunities to borrowers who may have thought they couldn’t afford to own a home.”
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Flagstar Bank has entered an agreement under which it will acquire eight branches of Desert Community Bank in San Bernardino County, Calif., from East West Bank.