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Tacoma, Washington-based Columbia Banking System amplified its push into Southern California on Wednesday, announcing it would acquire Irvine-based Pacific Premier Bank in a $2 billion, all-stock transaction that it expects to close in the second half of this year.

The deal marks Columbia’s second multibillion-dollar acquisition since October 2021, when it agreed to purchase Oregon-based Umpqua Bank for $5.2 billion. Though Columbia was the acquirer, the company’s retail bank network uses the Umpqua brand.

Columbia is walking that back in Wednesday’s deal, though. The company plans to tag its network as Columbia Bank later this year “to ensure brand clarity as Umpqua Bank deepens its expansion throughout the West,” it said.

The name change would align the retail brand with the holding company, as well as its wealth management and advisory arm, its private bank and its trust team, Columbia said.

Acquiring Pacific Premier would add roughly $18 billion in assets to Columbia and accelerate the bank’s expansion in Southern California “by approximately a decade,” said the lender, which would crack the top 10 in deposit market share in the area. The combined entity would count about $70 billion in assets after the transaction closes, the banks said.

The deal would also give Columbia access to some perhaps unsung low-cost deposit generators – namely, Pacific Premier’s homeowners association banking and custodial trust verticals.

For Pacific Premier clients, the transaction unlocks Columbia’s treasury management products and wealth management services.

"This combination truly establishes the leading banking franchise in the Western region,” Columbia CEO Clint Stein said Wednesday in a statement. “It is a natural and strategic fit that strengthens our competitive position in Southern California, enhances our service offerings, and elevates our performance.”

Columbia said it expects to gain roughly $900 million in value creation after $146 million in transaction expenses. The bank projected it would earn back its tangible book value dilution within three years. 

Columbia would also get a buffer from Pacific Premier’s 17% common equity tier 1 capital ratio, which is more than double the California bank’s 7% regulatory minimum.

“[Pacific Premier] is probably the best-capitalized bank in the country,” Stein told Bloomberg. “He’s got a war chest of capital, and we’re able to unlock that through purchase accounting and reset those asset marks to current market rates.”