Pennsylvania's FNB to expand in North Carolina with $117M deal

Dive Brief:

Pittsburgh-based FNB Corp. is looking to expand its retail banking footprint in North Carolina by acquiring Greenville-based UB Bancorp in an all-stock deal worth $117 million, the companies said Wednesday in a joint press release.
UB’s subsidiary Union Bank will merge with and into FNB’s subsidiary First National Bank, adding about $1.2 billion in assets to First National, and bringing its total assets to approximately $43 billion.
The transaction is expected to close in late 2022, according to the press release.

Dive Insight:

Banking M&A has cooled in recent months, as the Federal Reserve continues to hike interest rates. There were nine U.S. bank M&A deals in April, according to S&P Global, the lowest monthly tally of tie-ups in the industry since July 2020.

The all-stock transaction is valued at $19.56 per share, or a fully diluted market value of around $117 million, based on FNB's stock price at the close of trading Tuesday. UB Bancorp shareholders will receive 1.61 shares of FNB common stock for each share of UB Bancorp common stock they possess, according to the press release.

First National Bank counts total assets of $42 billion and operates more than 340 banking offices throughout the Pennsylvania, Maryland, Virginia, West Virginia, Ohio, North Carolina and South Carolina.

Union Bank is smaller, with $1.2 billion in total assets and 15 banking offices located throughout eastern and central North Carolina. The merger will give First National the eighth-largest deposit market share in North Carolina.

“North Carolina has proven to be a growth engine for our Company, and this new partnership with Union Bank will further leverage our investments in the market and accelerate our organic growth potential," FNB CEO Vincent J. Delie Jr. said in the press release.

"FNB and Union Bank share a deep cultural commitment to the clients and communities we serve. Our partnership with Union Bank represents another step in our continued investment in North Carolina with proforma deposits growing to over $7 billion since we entered the market in 2017."

After the transaction, the joint organization will oversee $35 billion in deposits and $28 billion in total loans.

"Union Bank's guiding principle is that of a local bank delivering personalized customer service to our clients," said Lee Burrows, chairman of Union Bank. "In FNB, we've found a like-minded partner committed to building meaningful relationships with its clients and communities ... Our partnership will add meaningful scale and access to a comprehensive product offering and broader in-market expertise that we believe will result in an enhanced customer experience for our clients."