The Arizona banking landscape is embracing change as Bancorp 34 Inc. and CBOA Financial Inc., the entities behind Bank 34 and Commerce Bank of Arizona, joined forces to emerge as Southwest Heritage Bank. According to official releases, the merger, which has been in the pipeline for approximately 11 months, achieved its finalization on March 19 and the banks commenced operations under the new name post systems integration over the weekend.
Jim Crotty, who led Bank 34 and now serves as the CEO of Southwest Heritage, expressed his elation over the merger's successful conclusion. "Fantastic," is how he described the sentiment, as reported by Phoenix Business Journal. The merger's finalization signaled Arizona's welcoming of a new entry in the billion-dollar asset club. It was initially forecasted to close in the fourth quarter of 2023, slightly missing the mark.
As of December 31, 2023, regulatory filings displayed Bank 34 holding $579.2 million in total assets, while Commerce Bank accounted for approximately $433 million. The unification brings Southwest Heritage Bank's initial total asset value to a substantial $1.012 billion. In light of the merger, Crotty plans to highlight the new bank's significant size within its status as a homegrown community institution. "To be a community bank headquartered in Arizona with some size and scale, those types of banks don't exist that much, so that is something we intend to play up," Crotty told Phoenix Business Journal.
The banking leaders are optimistic about the merger's impact despite the broad uncertainty surrounding interest rates and the prevailing caution among businesses awaiting rate cuts from the Federal Reserve. "We still see plenty of opportunity in our market for some high-quality deals," Crotty said, as per the same Phoenix Business Journal report. With the Southwest Heritage Bank now open for business, it aims to focus strongly on customer relationships and market share growth within Arizona's buoyant economy.
Chris Webster, former CEO of Commerce Bank of Arizona and now president of the new entity, echoed Crotty's sentiments about their customer commitment. "As Southwest Heritage Bank, we will remain steadfast in our dedication to providing the same unwavering support that our customers have come to expect from us. That means the same reliable service, personalized attention, and innovative solutions that have made us a trusted partner for countless individuals and businesses," Webster commented in a statement obtained by BizTucson.
The merger has produced a banking institution with a combined workforce of 120, following the pre-merger employment numbers publicized in the filings; 62 from Bank 34 and 58 from Commerce Bank. Geographically, Southwest Heritage Bank covers ground with locations in Arizona's Scottsdale alongside additional branches in New Mexico. The union symbolizes a strategic consolidation in Arizona's banking sector, traditionally noted for its dearth of locally-headquartered community banks. This merged entity is the state's latest addition to a slowly but notably expanding cluster of community banks that are gradually shaping Arizona's financial ecosystem.
