First National Bankers Bank in Baton Rouge said it has reached a deal to acquire Independent Bankers’ Bank of Florida in Lake Mary, Florida.
The definitive agreement was signed Tuesday. A sale price was not disclosed. However, SNL Financial, which tracks the banking industry, cited records from the bankruptcy filing of Independent Bankers’ Bank and said First National Bankers Bank submitted a $1.9 million bid. The sale is expected to close in the next 60 days, pending regulatory approval.
Joseph F. Quinlan Jr., chairman, president and CEO of FNBB, said his bank already had a presence in Florida, due to growth from its Birmingham, Alabama, office over the past three years. “We expanded into the Florida market slowly, but when an opportunity presented itself to us, we took a long, hard look at it,” Quinlan said.
FNBB was founded in 1984 and is the first nationally chartered banker’s bank in the country.
Bankers’ banks don’t take deposits from the public or make loans to consumers. Instead, bankers’ banks provide services to community banks. In FNBB’s case, those services may include audits, investment sales, property and workers’ compensation insurance, data processing and assistance with larger loans.
The bank got a boost in business in 2010 with the passage of the Dodd-Frank financial reform bill. That significantly increased the compliance burden on community banks. FNBB came up with a suite of services to help smaller financial institutions, without requiring them to spend a significant amount of money, Quinlan said.
FNBB has seven offices serving 13 states, with locations in Shreveport; Little Rock, Arkansas; Marietta, Georgia; Maitland, Florida; and Ridgeland, Mississippi, to go along with the Baton Rouge and Birmingham locations. FNBB has about $877 million in assets, which will grow to $1 billion with the Florida acquisition.
SNL Financial said Independent Bankers’ Bank was forced into bankruptcy because of the Great Recession, which hit Florida hard and put more than 75 local banks out of business. That reduced its customer base and ability to meet certain regulatory requirements for capital, profitability and credit quality.
Quinlan said the acquisition will expand FNBB across the Gulf South by providing a regional office in Lake Mary. The deal increases FNBB’s customer base to more than 800 financial institutions.
Quinlan said the two financial institutions share similar business philosophies focused on contributing to the success of community banking. “Our cultures are very, very similar, so that made this a very feasible effort,” he said.
FNBB plans to keep all 26 of the current Independent Bankers’ Bank employees.
“The transition will be seamless,” Quinlan said.
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