Valley National Bancorp, the parent company of Valley National Bank, has agreed to acquire New Jersey-based bank holding company Oritani Financial in an all-stock deal worth $740m (£584.08m).
Oritani Financial is the holding company for Oritani Bank, a state chartered bank, which offers a range of retail and commercial loan and deposit products.
As per the terms of the merger, shareholders of Oritani will exchange each of their shares with 1.60 shares of Valley National common stock.
According to Valley National, both the banks have similar focus on the northern New Jersey markets and the acquisition doubles its market share in Bergen County, while improving its footprint in Hudson County.
The transaction is also expected to help Valley National strengthen its capital, offer greater balance sheet optionality and accelerate its previously announced strategic initiatives.
Valley National president and CEO Ira Robbins said: “This capital-enriching transaction will enable Valley to continue to focus on improving the growth profile throughout its entire franchise, while providing enhanced products, services and delivery channels to Oritani’s existing customer base. We are excited about this in-market combination and the synergies that it will bring us.”
Valley National holds nearly $32.5bn (£25.6bn) in assets, $25.4bn (£20.1bn) in loans, and $24.9bn (£19.7bn) in deposits. The bank holding company operates over 200 branches across New Jersey, New York, Alabama, and Florida.
Oritani, on the other hand, has about $4.1bn (£3.2bn) in assets, $3.5bn (£2.8bn) in loans, and $2.9bn (£2.3bn) in deposits. Its subsidiary has a branch network of 26 offices in the Bergen, Hudson, Essex and Passaic counties in New Jersey.
Oritani chairman, president and CEO Kevin Lynch said: “We are thrilled about this combination with Valley. The infrastructure that has been assembled at Valley over the past few years will enable our customers to access a substantial product offering while still receiving the local decision making and the exceptional service they have become accustomed to at Oritani.”
The merger, which will be subject to receipt of regulatory approvals, shareholder approvals of both the companies, and meeting of other customary conditions, is expected to be wrapped up towards the end of the fourth quarter of 2019.