Bank of Beverly Hills said it will...

Bank of Beverly Hills said it will acquire Merchant Bank of California--both small Beverly Hills banks--through an exchange of stock. Merchant Bank said the Federal Deposit Insurance Corp. found that Merchant Bank is operating with inadequate capital and reserves, has an excessive volume of poor-quality assets and that the safety of its deposits are in jeopardy. Merchant Bank, which was given 120 days to increase its adjusted primary capital by $3 million and eliminate all assets classified as “loss” by the FDIC, said it believes that its acquisition by Bank of Beverly Hills will cause the FDIC to withdraw its order of correction.