Bank of Santa Barbara is being sold to a group of investors headed by veteran Santa Barbara banker Eloy Ortega, the bank’s parent company said July 13.

The exact price of the sale wasn’t disclosed. Ortega agreed to a cash payment of 1.6 times the tangible common equity of the $62 million Bank of Santa Barbara, according to the bank’s news release.

“We just think it’s a very opportune time right now in banking – because of the difficulties and challenges in the economy – to have a good, solid, well-capitalized institution,” Ortega told the Business Times. “We’ve got a very high-profile group of local investors that have stepped up and wanted to bring this bank back into Santa Barbara because even though the minority interest was owned locally, we wanted to bring the full interest back into the community.”

Before acquiring Bank of Santa Barbara, Ortega was president and CEO of City Commerce Bank and founding president and CEO of Business First National Bank.
Ortega said he has about 10 investors assembled for this part of the transaction, including the Hutton Foundation, the Orfalea Family Foundation and Tim and Bernie Marquez of Venoco. Ortega said the investors wanted to take the foundation of Bank of Santa Barbara, localize its ownership and add significant new capital.

Before the sale, Bank of Santa Barbara was majority-owned by Michigan-based Capital Bancorp, which owns eight affiliate banks in California with assets in excess of $600 million as of March 31.

The Business Times reported earlier on the potential sale of Bank of Santa Barbara. Click here to read the coverage.

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