SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report 03/26/96
CU BANCORP
(Exact name of registrant as specified in its charter)
California 0-11008 95-3657044
(State or other jurisdiction Commission IRS Employer
of incorporation) File Number Identification No.
16030 Ventura Boulevard, Encino, California 91436
(Address of Principal Executive Offices)(Zip Code)
N/A
(former name or former address if changed since last report)
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Item 2. Acquisition or Disposition of Assets
On January 12, 1996, the Registrant completed the acquisition of Corporate Bank,
of Santa Ana California, information as to which was previously reported on the
Registrants Registration Statement of Form S-4, Registration Number 33-63729,
which is incorporated herein by reference (the "Proxy/Prospectus").
In connection with the acquisition, Corporate Bank was merged into California
United Bank, National Association, the sole subsidiary of the Registrant.
For a discussion of the terms and conditions of the transaction and the pricing
mechanism, reference is made to the Proxy/Prospectus. The final consideration
paid was equal to $6,493 thousand , consisting of 649 thousand shares of the
Registrant's Common Stock and $1,730 thousand in cash payments to shareholders
(not including compensation for fractional shares). The source of funds was
general working capital of the Registrant, no amounts were borrowed.
The two former offices of Corporate Bank will be operated by California United
Bank as branch offices.
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Item 7. Financial Statements and Exhibits
(a) Financial Statements of Business acquired.
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1. Unaudited Statements of Operations of Corporate Bank for the nine months
ended September 30, 1995, and 1994. Page 3
2. Unaudited Balance Sheet, of Corporate Bank as of September 30, 1995 and 1994
Page 4
3. Financial Statements of Corporate Bank for the years ending December 31, 1993
and 1994, incorporated by reference from and filed as part of Registrants
Registration Statement on Form S-4 (Registration Number 33-63729) dated October
26, 1995.
(b) Pro Forma Financial Statements
Unaudited Pro Forma Combined Financial information Page 5
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: 03/26/96
CU BANCORP
Page 2 PATRICK HARTMAN, CHIEF FINANCIAL OFFICER
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Corporate Bank
Unaudited Statements of Operations
For the nine months ended September 30, 1995 and 1994
Amounts in thousands of dollars
1995 1994
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Interest and fees on loans and leases $4,062 $4,178
Interest on investment securities 165 191
Interest on time certificates of deposit 27 71
Interest on federal funds sold 311 263
Total interest income 4,565 4,703
Interest on deposits 1,013 959
Net interest income 3,552 3,744
Provision for loss 499 22
Net revenue from earning assets 3,053 3,722
Non interest income 448 504
Non interest expense 3,575 3,801
Income before taxes (74) 425
Taxes on income (25) 186
Net income ($49) $239
Earnings Per Share ($0.10) $0.48
Weighted Average Shares Outstanding 500 500
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Corporate Bank
Unaudited Balance Sheet
As of September 30, 1995 and 1994
Assets 1995 1994
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Cash and due from banks $4,623 $5,531
Federal funds sold 9,900 10,900
Securities held to maturity 0 0
Securities available for sale 4,254 6,197
Time certificates of deposit 198 2,477
Loans, net 48,324 49,453
Premises and equipment 533 714
Other real estate owned 575 1,672
Other assets 1,000 434
Total Assets $69,407 $77,378
Liabilities
Demand deposits $26,911 $30,235
Interest bearing deposits 33,686 37,980
Total deposits 60,597 68,215
Other liabilities 1,752 1,381
Total Liabilities 62,349 69,596
Capital 7,058 7,782
Total Liabilities & Capital $69,407 $77,378
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Unaudited Pro Forma Combined Financial Information
The following Unaudited Pro Forma Combined Balance Sheet as of September 30,
1995 and Unaudited Pro Forma Combined Statements of Income as for the year ended
December 31, 1994 and the nine months ended September 30, 1995 have been
prepared to reflect the effects on the historical results of CU Bancorp of the
merger of Corporate Bank into California United Bank, NA, CU Bancorp's principal
subsidiary. The Unaudited Pro Forma Combined Balance Sheet has been prepared
as if the merger occurred on September 30, 1995. The Unaudited Pro Forma
Combined Statements of Income have been prepared as if the merger occurred on
January 1, 1994. The pro forma financial information set forth below is
unaudited and not necessarily indicative of the results that will actually occur
in the future.
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Unaudited Pro Forma September 30, 1995
Combined Balance Sheet
CU Bancorp/
Corporate
Assets CU Bancorp Corporate Bank Adjustments Combined
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Cash and due from banks $20,905 $4,623 (1) (1,730) $23,798
Federal funds sold 32,000 9,900 41,900
Securities held to maturity 73,088 0 73,088
Securities available for sale 0 4,254 4,254
Time certificates of deposit 0 198 198
Loans, net 176,680 48,324 (2) (1,000) 224,004
Premises and equipment 1,196 533 (3) (200) 1,529
Other real estate owned - 575 (4) (300) 275
Other assets 7,149 1,000 (5) 4,335 12,484
Total Assets $311,018 $69,407 $1,105 $381,530
Liabilities
Demand deposits $84,913 $26,911 - $111,824
Interest bearing deposits 185,880 33,686 219,566
Total deposits 270,793 60,597 - 331,390
Other liabilities 8,080 1,752 (6) 3,400 13,232
Total Liabilities 278,873 62,349 3,400 344,622
Capital 32,145 7,058 (7) ($2,295) 36,908
Total Liabilities & Capital $311,018 $69,407 $1,105 $381,530
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Unaudited Pro Forma Combined Statement of
Income For the nine months ended September 30, 1995
CU Bancorp/
CU Bancorp Corporate Corporate
Bank Adjustments Combined
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Interest and fees on loans and leases $13,800 $4,062 $17,862
Interest on investment securities 2,796 165 2,961
Interest on time certificates of deposit 2 27 29
Interest on federal funds sold 1,477 311 1,788
Total interest income 18,075 4,565 22,640
Interest on deposits 6,628 1,013 7,641
Net interest income 11,447 3,552 14,999
Provision for loss 0 499 499
Net revenue from earning assets 11,447 3,053 14,500
Non interest income 1,674 448 2,122
Non interest expense 9,361 3,575 (8) 175 13,111
Income before taxes 3,760 (74) (175) 3,511
Taxes on income 1,647 (25) 1,622
Net income $2,113 ($49) ($175) $1,889
Earnings Per Share $0.35
Weighted Average Shares Outstanding (9) 5,422
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Unaudited Pro Form Combined Statement ofIncome
For the year ended December 31, 1994 CU Bancorp/
Corporate Corporate
CU Bancorp Bank Adjustments Combined
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Interest and fees on loans and leases $14,036 $5,524 $19,560
Interest on investment securities 2,966 258 3,224
Interest on time certificates of deposit 39 99 138
Interest on federal funds sold 918 370 1,288
Total interest income 17,959 6,251 24,210
Interest on deposits 4,078 1,257 5,335
Net interest income 13,881 4,994 18,875
Provision for loss 0 1,134 1,134
Non interest income 5,408 637 6,045
Non interest expense 14,735 5,260 (8) 233 20,228
Income before taxes 4,554 (763) (233) 3,558
Taxes on income 1,980 (244) 1,736
Net income $2,574 ($519) ($233) $1,822
Earnings Per Share $0.35
Weighted Average Shares Outstanding (9) 5,242
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Notes:
1) Represents the $1,730 thousand distributed to Corporate Shareholders as the
cash portion of the purchase price of Corporate Bank.
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2) The loan portfolio for Corporate Bank is adjusted in the purchase entry to
reflect the loan loss reserve at estimated market value as of the acquisition
date. Total additional required loss reserves are estimated at $1 million.
3) Fixed assets and leasehold improvements at Corporate Bank are adjusted
downward by $200 thousand to estimated market value at the acquisition date.
4) The Other Real Estate Owned portfolio for Corporate Bank is adjusted in the
purchase entry to reflect the estimated market value of the properties owned at
the acquisition date. The additional loss reserve required is estimated at
$300,000.
5) Additions to other assets include $2,009 thousand of deferred taxes and
$2,326 thousand in goodwill generated by the merger transaction.. The
goodwill balance is the difference between the purchase price for Corporate Bank
of $6,493 thousand and the estimated market value of Corporate Bank's net
assets..
6) Corporate Bank has lease commitments related to their Santa Ana office that
are in excess of estimated current market value. Under the purchase method of
accounting, a liability of approximately $3 million would be booked at the
merger date to record the excess of lease commitments over the current market
for rental of similar facilities. Additional liabilities of $400 thousand are
required to cover costs related to the acquisitions and miscellaneous market
value adjustments at the acquisition date.
7) Adjustments to total capital include the assumed issuance of approximately
649 thousand shares of CU Bancorp common stock with a value of $4,763 thousand,
and the elimination of Corporate Bank's $7,058 thousand in equity as the
Corporate Bank shares are exchanged for CU Bancorp stock and cash.
8) The only adjustment to the pro forma combined statements of income is the
assumed amortization of goodwill generated by the merger transaction. Goodwill
of $2,326 thousand amortized over the full year of 1994, assuming a ten year
life, would have generated $233 thousand of expense. The same goodwill
amortized over the nine months ended September 30, 1995 would have generated
additional expense of $175 thousand. No adjustments have been made for any
operational synergies that may occur as a result of the merger.
9) Pro forma earnings per share for the year ended December 31, 1994 were
calculated based on CU Bancorp's 4,593 thousand weighted average shares
outstanding plus 649 thousand shares assumed to be issued in the merger
transaction. Pro forma earnings per share for the nine months ended September
30, 1995 were calculated based on CU Bancorp's 4,773 thousand weighted average
shares outstanding plus 649 thousand shares assumed to be issued in the merger
transaction. There is no difference for this entity between fully diluted and
primary earnings per share.
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