The acquisition will enable FNB to enhance its growth and strengthen its presence in the Mid-Atlantic Region
Pennsylvania-based F.N.B. Corporation (FNB) has agreed to acquire Howard Bancorp in an all-stock transaction valued at around $418m.
The transaction value is based on the closing stock price of FNB as of 12 July 2021.
As part of the deal, Howard Bancorp’s wholly-owned banking subsidiary Howard Bank will merge with and into First National Bank of Pennsylvania, a subsidiary of FNB.
Based in Baltimore, Maryland, Howard operates 13 full-service banking offices in Baltimore and the greater Washington, D.C., area.
It had around $2.6bn in total assets, $2bn in total deposits and $1.9bn in total loans and leases on 31 March 2021.
FNB chairman, president and CEO Vincent J Delie Jr said: “FNB and Howard share a deep cultural commitment to client and community service.
“Combined, we will have the sixth-largest deposit share in the Baltimore market, reinforcing our strong presence and presenting our organizations with the opportunity to deliver an enhanced experience for our customers, communities and dedicated teams.”
Once the proposed merger is closed, FNB will have around $41bn in total assets, $32bn in deposits and $27bn in total loans, on a pro-forma basis.
Under the terms of the merger agreement, Howard stockholders will be eligible to receive 1.8 shares of FNB common stock for each share of Howard common stock held.
With the acquisition of Howard, FNB is enabled to enhance its growth and strengthen its presence in the Mid-Atlantic Region.
The transaction is expected to close in early 2022, subject to satisfaction of customary closing conditions, including regulatory approvals and the Howard stockholder’s approval.
Howard Bancorp chairman and CEO Mary Ann Scully said: “Howard Bank has long committed to building our relevance to our stakeholders as well as our impact on our communities.
“FNB, in turn, has a long-standing reputation in Maryland as a premier financial institution that is similarly committed to building meaningful relationships with its clients and communities.
“Our partnership will add enviable scale and greater access to a comprehensive set of products, services and broader in-market expertise that we believe will result in an enhanced customer experience for both our core commercial base and our growing retail clientele.”
Morgan Stanley & Co. served as financial advisor and Reed Smith as legal counsel to FNB for the transaction.
Keefe, Bruyette & Woods, A Stifel Company, served as financial advisor and Nelson Mullins Riley & Scarborough served as legal counsel to Howard.