(RTTNews) -  Parent company of East West Bank, East West Bancorp, Inc. (EWBC: News ) announced Friday that it has acquired the banking operations of United Commercial Bank or UCB in a Federal Deposit Insurance Corporation or FDIC assisted transaction. East West Bank will assume all of UCB's domestic branches, as well as its international subsidiaries.

San Francisco, California-based UCB is the biggest among the five banks to fall late Friday, which had 63 U.S. branches as well as operations in Hong Kong and Shanghai, holding total deposits of $7.5 billion. UCB's failure would cost the FDIC's Deposit Insurance Fund an estimated $1.4 billion. East West Bank has paid a premium of 1.1% to FDIC for the right to assume UCB's deposits. FDIC and East West Bank have also agreed to share losses on about $7.7 billion of UCB's failed assets.

Under the terms of the transaction, East West will receive $10.4 billion in assets, including $7.7 billion in loans, and assume $9.2 billion in liabilities, including $6.5 billion in deposits of UCB. The FDIC and East West have entered into a loss sharing agreement covering substantially all acquired loans.

East West noted that the transaction would strengthen its presence in key markets throughout the U.S. and Asia and is another important milestone in realizing its vision to be recognized as the premier bridge between East and West.

In a statement, chairman, president and chief executive officer of East West, Dominic Ng said, "We welcome UCB's customers and employees to the East West Bank family. All customers can rest assured that all of their deposits are safe and accessible, continue to be covered under the FDIC insurance program, and are now backed by the security and strength of East West Bank. For our new UCB customers, it's business as usual and there will be no interruption in service. In the months ahead, we look forward to offering all of our customers a wider array of financial products and services, and an expanded branch and ATM network."
The transaction creates the largest U.S. bank focused on serving the Asian American community, and the second largest independent bank headquartered in California. With this transaction, East West Bank has now increased its assets to over $19 billion from $12.5 billion, and will operate 137 worldwide branches, including four full-service branches in Greater China, including two branches in Hong Kong, and branches in Shanghai and Shantou.

With five more banks closing shutters on Friday, the total bank closures for 2009 has reached 120, which is more than four times the number that were closed in 2008 of 25 bank failures. An average of 11 banks have failed per month in 2009. It's the highest total bank failures in a year since 1992, when 181 banks failed. Only three banks failed in 2007.

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