US lender NBT Bancorp Merges with Evans Bancorp for $236M Deal
NBT Bancorp and Evans Bancorp announce a $236 million merger, expanding NBT's presence in western New York with $16 billion in assets.
In a significant move within the financial sector, NBT Bancorp, headquartered in Norwich, New York, has announced its agreement to merge with Evans Bancorp, based in Williamsville, New York. The all-stock transaction is valued at approximately $236 million, as disclosed by the companies on Monday. This merger is poised to enhance NBT's presence in western New York, creating a combined entity that will boast around $16 billion in assets, $12 billion in loans, and $13 billion in deposits. The market capitalization of the new organization is projected to be about $2.4 billion, according to NBT's investor presentation.
Strategic Goals and Financial Implications
The merger is expected to close in the second quarter of 2025, pending approval from shareholders and regulatory bodies. Both companies' boards have already given their consent to the deal. Following the merger, Evans Bank will integrate into NBT Bank, with NBT emerging as the surviving entity. This strategic alignment is set to establish the combined organization as the leader in deposit market share among banks with assets under $100 billion in Upstate New York. The new entity will operate a network of 172 locations, extending from Buffalo, New York, to Portland, Maine.
NBT will acquire 100% of Evans’ outstanding shares, with a fixed exchange ratio of 0.91 NBT shares for each share of Evans. This valuation is based on NBT's closing stock price of $46.28 as of last Friday. The merger is anticipated to yield an earnings per share accretion of 13.6%, with a tangible book value earnback expected in less than three years. Notably, should the agreement fall through, Evans may be liable to pay NBT a termination fee of $8.4 million, as outlined in the SEC filing.
NBT Bancorp: A Growing Presence
NBT Bancorp, with assets totaling $13.5 billion, currently operates 154 banking locations across New York, Pennsylvania, Vermont, Massachusetts, New Hampshire, Maine, and Connecticut. This merger marks NBT's second significant acquisition in just over a year; last August, the bank successfully completed its merger with Salisbury Bancorp, adding 13 banking locations to its portfolio.
On the other hand, Evans Bancorp, with assets of $2.26 billion, operates 18 branches throughout western New York under its subsidiary, Evans Bank. The bank previously expanded its footprint by acquiring Rochester-based Fairport Savings Bank in May 2020. This latest merger will enable NBT to extend its reach westward along the New York State Thruway, targeting key markets such as Buffalo and Rochester - two vital areas that are integral to the region's burgeoning tech hub.
A Surge in Bank Mergers and Acquisitions
The announcement of this merger comes amid a notable increase in bank mergers and acquisitions, which have outpaced last year’s activities. According to data from Dealogic, there have been 38 deal announcements through August 1, compared to 29 during the first seven months of 2023. This trend indicates a robust consolidation phase within the banking sector, as institutions seek to enhance their competitive edge and expand their market presence.
This merger is not an isolated event; it follows another significant announcement made just days earlier. On Friday, ConnectOne Bancorp, based in Englewood Cliffs, New Jersey, revealed its plans to merge with The First of Long Island Corp., located in Melville, New York. This all-stock transaction is valued at $284 million and aims to create a premier middle-market bank focused on the greater New York metro area.
Additionally, last month saw Busey Bank from Champaign, Illinois, and CrossFirst Bank from Leawood, Kansas, announce their intention to merge in a $916.8 million all-stock transaction, set to close in the first half of 2025. This merger will result in a bank with a 10-state footprint and assets nearing $20 billion.
The merger between NBT Bancorp and Evans Bancorp represents a strategic effort to bolster their market presence in New York, particularly in the western regions. With the combined assets and expanded network of branches, the new entity is well-positioned to serve a broader customer base while enhancing its competitive standing in the banking industry. As the trend of bank mergers and acquisitions continues to rise, stakeholders will be keenly observing how these developments shape the financial landscape in the coming years.
US lender NBT Bancorp Merges with Evans Bancorp for $236M Deal
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