Credit Unions Snap Up Community Banks
A flurry of deals in late August saw mergers and acquisitions announced in North Carolina, Pennsylvania, Michigan and Alabama
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- Written by Banking Exchange staff
Two credit unions have announced purchases of community banks, echoing a trend that dominated last year.
Michigan State University Federal Credit Union (MSUFCU) has announced the acquisitions of Algonquin State Bank and McHenry Savings Bank, on top of planned new branches across Chicago, Illinois.
The aggressive expansion plan is set to grow MSUFCU’s balance sheet to approximately $9 billion in assets by the end of 2024.
Both transactions are subject to regulatory and shareholder approval.
Meanwhile, Alabama-based Five Star Credit Union has agreed to purchase Georgia-headquartered OneSouth Financial, parent to OneSouth Bank.
According to M&A advisory firm Olsen Palmer, the acquisition will add four branches to Five Star’s 19-strong network, and increase its assets by more than $200 million to almost $1 billion.
The deal is expected to close in the second quarter of 2024 and is subject to regulatory and shareholder approval.
Other transaction announced in recent days:
- In Virginia, Burke & Herbert Financial Services is to merge with Summit Financial Group to create a banking company with more than $8 billion in assets. The deal, valued at $371.5 million, is expected to close in the first quarter of next year subject to the necessary approvals.
According to a press release, the combined company will use the Burke & Herbert branding and have a “significant operational presence in West Virginia”.
David Boyle, Burke & Herbert’s president and CEO, said: “This partnership brings together two organizations dedicated to a community banking model that places an emphasis on service and dedication to the people who live and work among us.”
- Pennsylvania’s NexTier Bank is to acquire Mars Bank, based in the same state. The deal will add approximately $520 million in assets to the NexTier’s balance sheet, as well as “strong capability in retail, mortgage, and commercial lending along with digital acquisition”, NextTier said in a statement.
“This merger ensures our customers will continue to receive access to the products, services, and technology they need, while maintaining the relationship-driven, hands-on service they’ve come to expect,” said Jim Dionise, Mars Bank’s president and CEO.
The deal is also subject to regulatory and shareholder approvals, and is expected to be completed in the first quarter of 2024.
Other deals announced in the past two weeks include a between
- PB Financial Corporation and Coastal Bank & Trust, both based in North Carolina, have announced a “strategic merger”. This transaction, valued at approximately $25.8 million, will create a $1.1 billion-asset bank operating under PB Financial’s Provident Bank brand.
- Prominent Tennessee banking owner Gaylon Lawrence Jr plans to merge two of his companies. Fourth Capital Bank is to merge into Volunteer State Bank, subject to regulatory approval.
“Middle Tennessee is known for its vibrant and diverse economic climate, and it continues to be one of the fastest growing areas in the nation,” Lawrence said. “The decision to merge Fourth Capital into Volunteer State Bank strategically positions the brand to better optimize growth opportunities today, and in the future.”
- Finally, CCFNB Bancorp and Muncy Bank Financial Merger have received regulatory approval for their proposed merger of equals. The deal will close on November 11, 2023, subject to shareholder approval.
The merger will result in a combined company with approximately $1.6 billion in total assets, while Muncy Bank and Trust Company will merge with and into First Columbia Bank & Trust. The new bank will be named Journey Bank, while the combined holding company is set to be rebranded as Muncy Columbia Financial Corporation.
Tagged under Community Banking, Credit Unions, Feature, Financial Trends, Feature3, Management, M&A,
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