Prosperity Bancshares, a Texas-based financial holding company, has signed a definitive agreement to acquire 19 Texas retail bank branches of Missouri-based First Bank.
Prosperity Bank will pay a premium for approximately $500m in deposits, as well as purchase approximately $100m in loans and other assets attributable to the branches.
Prosperity will pay a premium of 5.5% for the deposits of the Texas branches of First Bank. The deposits to be assumed are primarily core deposits and will enhance Prosperity’s market position in Texas. The $100m in loans to be purchased were individually selected by Prosperity from First Bank’s loan portfolio associated with the Texas branches and consist of performing business and consumer-related Texas-based loans.
David Zalman, CEO and chairman of Prosperity Bancshares, said: “We are pleased to be able to expand further in our core markets of Houston and Dallas. We believe our long term strategy of expanding our footprint will continue to produce rewards for our shareholders. We look forward to servicing the Texas customers of First Bank.”
David Weaver, regional president of First Bank in Texas, said: “We are excited to be joining Prosperity Bank and look forward to contributing to the growth of such an established and well-respected Texas franchise.”
The definitive agreement has been approved by both banks and the transaction is expected to close during the second quarter of 2010. However, the transaction is subject to certain conditions, including customary regulatory approvals.