Honolulu-based First Hawaiian Bank is returning to the mainland with a roughly $2 billion acquisition of Tri Counties Bank, headquartered north of Sacramento, California.

The deal, expected to close by year-end, would more than double First Hawaiian’s branch count and create a financial institution with about $34 billion in assets and $29 billion in deposits, the companies announced Monday.

In a statement Monday, First Hawaiian CEO Bob Harrison said the tie-up “creates a broader platform for long-term growth.”

“TriCo is an ideal partner to execute this next phase of our growth: a well-managed, relationship-focused bank in California with a strong deposit franchise, disciplined credit culture, experienced local leadership and deep commitment to its communities,” Harrison said. “Together, we will preserve what has made both companies successful while creating a stronger and more diversified bank.”

First Hawaiian said it will retain Tri Counties Bank branding on the mainland and keep open all of the Chico, California-based bank’s branches.

TriCo CEO Rick Smith, on a conference call regarding the acquisition, called the branch consideration crucial to the deal.

"Those things really matter when you talk about retention of key people to make the organization go forward," Smith said.

First Hawaiian became part of BNP Paribas’ network in 1998. But the French bank divested its stake in the Hawaiian lender in 2019, shortly before selling its U.S. retail franchise, Bank of the West, to BMO.

"What we've lacked since our separation from Bank of the West is a branch network to expand client relationships and offer a full suite of product offerings," Harrison said on the conference call.

As part of Monday’s deal, TriCo’s shareholders will receive 2.095 First Hawaiian shares for each share they own. That comes out to $63.12 per share, based on First Hawaiian’s closing stock price from Friday.

Once the transaction closes, First Hawaiian is expected to own roughly 65% of the combined company, and TriCo will own about 35%, the banks said.

Four TriCo directors will join the boards of First Hawaiian Bank and its parent company. Smith will be one of them; the other three will be mutually agreed upon before the deal closes, the banks said.

"TriCo has built its franchise around long-term customer relationships, local decision-making and a commitment to the communities we serve,” Smith said in a statement Monday. “First Hawaiian shares those values and brings the scale, capital strength and broader product capabilities to help us do even more for our customers and communities.

First Hawaiian projects cost savings of 25% as part of the deal, according to a presentation to investors.

And while on the subject of bottom line, the Hawaiian lender on Monday previewed a handful of metrics it intends to announce July 24 as part of second-quarter earnings.

The bank will report net income of $73.4 million, up from $67.8 million the previous quarter. First Hawaiian also listed its return on average tangible common equity at 16.3%, up from 15.3% the previous quarter.

Buying TriCo would give First Hawaiian an extra 75 or so branches in California, on top of the Hawaiian lender’s existing 53-location presence.

Harrison, however, emphasized that just because the majority of First Hawaiian’s footprint would soon be on the mainland, that doesn’t mean the bank would shift focus completely.

"Hawaii is still home. It is still the core of what we're doing on a combined basis," he said on the conference call, adding that the bank would “continue to grow and build capital and invest now in two places.”

As of March 31, First Hawaiian’s assets stood at $24.3 billion, while TriCo counted nearly $10 billion.