Following the strategic combination of the Mechanics Bank and Rabobank, John DeCero, president and CEO of Mechanics Bank, and Mark Borrecco, CEO of Rabobank, will serve as Co-CEOs of the new organization.
DeCero and Borrecco will also become members of a newly created Office of the chairman, which will chart the future direction of the combined bank.
Under a strategic business combination announced in March, Mechanics Bank is set to acquire Rabobank’s retail, business banking, commercial real estate, mortgage, and wealth management businesses. The combined entity is slated to operate under the Mechanics Bank name, with 144 branches and in excess of $17 billion in total assets.
“This unique Co-CEO structure will put tremendous experience and expertise at the helm of our new bank,” said Carl B. Webb, chairman of the board of Mechanics Bank. “Both John and Mark are very successful CEOs, and their individual capabilities, skills and personalities are highly complementary of one another. Working together, they will be a powerful and successful team in unlocking the full potential of this unique franchise and establishing Mechanics Bank as the premier community bank in California.”
Following the close of the transaction, DeCero will oversee commercial banking, wealth management and indirect auto finance at the new organization. With more than 29 years of banking experience, he has served as president & CEO of Mechanics Bank since October 2016. He was a co-founder of California Republic Bank, which was acquired by Mechanics Bank in 2016. He built a successful commercial banking group for the former Western Financial Bank and has also held positions at Citicorp and Comerica Bank.
Borrecco will oversee the retail banking and consumer lending activities at the combined organization. A 25-year banking veteran, he was named CEO of Rabobank in 2015. Prior to that, he was national retail sales manager for Bank of the West and has held positions at several other financial institutions, including Wachovia and World Savings.
“Bank mergers with this much potential don’t happen often,” said DeCero. “We are going to embrace the strong, complementary attributes of both organizations to build a powerful financial institution that delivers an outstanding customer experience across both the retail and commercial segments. Mark and I are committed to a partnership of innovation that will drive growth in all of our business lines.”
Total consideration for the transaction will be approximately $2.1 billion, subject to customary purchase price adjustments at closing. As part of the total consideration payable in the transaction, Rabobank Group will receive 9.9% of the outstanding shares of Mechanics Bank after giving effect to the transaction. Currently, 79% of Mechanics Bank’s outstanding shares are owned by Ford Financial Fund II.
The transaction is expected to close in the Q3/19.
Established in 1905, Mechanics Bank is an independent, full-service community bank, based in Walnut Creek, CA.
Rabobank is a nationally chartered bank serving California communities grounded in agriculture.
