The Bank Slate


Bancorp 34: 4Q loss reflects merger expenses, funding costs

Bancorp 34 in Scottsdale, Ariz., reported a quarterly loss that largely reflected costs tied to a pending acquisition.


The $581.3 million-asset company lost $1.7 million in the fourth quarter, which included $1.7 million in expenses tied to its plan to buy CBOA Financial in Tucson, Ariz. Bancorp 34 also said that higher funding costs as a factor.


Separately, Bancorp 34, which lost nearly $2.3 million in the third quarter due to a loan-loss reserve for a commercial real estate credit, disclosed that sold the loan last month.


The note for the loan, which had a $3 million carrying value, was sold for $2.5 million. The additional $500,000 loss, which reflected a decline in rents collected this year, will be reflected in the first quarter.


Bancorp 34 said it expects its purchase of CBOA to close later this month. The company plans to rebrand its bank as Southwest Heritage Bank.


“While 2023 presented a challenging market, rate, and deposit environment that limited any material balance sheet growth, we saw our bank improve process, procedures and efficiencies to prepare for the future,” Jim Crotty, the company’s president and CEO, said in the release.


“Our team has started the preparations for life as a bank approaching and ultimately growing beyond $1 billion in assets,” Crotty added.

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