First Banks, the parent company of First Bank, has completed the sale of certain assets and the transfer of certain liabilities of its Texas franchise on April 30, 2010 to Prosperity Bank, a subsidiary of Texas-based Prosperity Bancshares.
Prosperity Bank assumed approximately $500m of deposits associated with First Bank’s 19 Texas retail branches, including certain commercial deposit relationships, for a premium of approximately 5.5%.
Prosperity Bank also purchased approximately $100m of loans as well as certain other assets at par value, including premises and equipment, associated with First Bank’s Texas operations.
The completion of the sale of the Texas franchise follows closely after the completion of the sale of First Bank’s institutional money management subsidiary, Missouri Valley Partners(MVP), to Stifel Financial on April 15, 2010.
In addition, First Bank also signed a branch purchase and assumption agreement on May 7, 2010 providing for the sale of certain assets and the transfer of certain liabilities of 10 Northern Illinois branches to First Mid-Illinois Bank & Trust, a wholly owned subsidiary of Illinois-based First Mid-Illinois Bancshares.
Under the terms of the agreement, First Mid-Illinois is to assume approximately $350m of deposits associated with the acquired branches in Peoria, Galesburg, Quincy, Bartonville, Knoxville and Bloomington, including certain commercial deposit relationships, for a premium of approximately 4.77%.
First Mid-Illinois is also expected to purchase approximately $150m of loans as well as certain other assets at par value, including premises and equipment, associated with the acquired branches.
Terrance McCarthy, president and CEO of First Banks, said: “The announced sale of 10 of our Northern Illinois branches as well as the completion of the sales of our Texas operations and MVP in April and our Chicago operations in February, represent the successful achievement of a number of key elements associated with our previously announced capital plan, which was developed to preserve our risk-based capital during the current and continuing economic downturn.”