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CapitalSource gets California approval for Fremont deal

By Associated Press
June 13, 2008 | Comments (0)

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CapitalSource Inc. said it received California regulatory approval to establish a bank in that state, moving it a step closer to closing its purchase of Fremont General's retail banking operations.

CapitalSource said the California Department of Financial Institutions approved applications to create a bank and acquire the distressed Fremont's 22 branches and $5.6 billion in deposits.

In April, CapitalSource agreed to pay 2 percent premium on the bank's deposits, receive a discount on retained interest in certain real estate loans the bank holds and pay an additional $58 million for the branches.

The deal still requires approval from the Federal Deposit Insurance Corporation.

CapitalSource shares rose 58 cents, or 4 percent, to $14.42 in midday trading. The stock has ranged from $7.56 to $25.60 in the past year.

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