Dive Brief:

• The Federal Deposit Insurance Corp. has approved Wheeling, West Virginia-based WesBanco’s bank merger application to acquire Youngstown, Ohio-based Premier Bank, the regulator said Friday.
• The resulting bank, using the WesBanco name, will operate in West Virginia, Indiana, Kentucky, Maryland, Michigan, Pennsylvania and Ohio, the FDIC said in a news release.
• The all-stock deal, worth roughly $959 million and announced last July, awaits Federal Reserve approval. The merger received approval from the shareholders of both WesBanco, Inc. and Defiance, Ohio-based Premier Financial Corp. on Dec. 11, according to a news release.

Dive Insight:

The deal remains on track to close during the first quarter, WesBanco CEO Jeff Jackson said last week during the bank’s fourth quarter earnings call. A WesBanco spokesperson on Monday reiterated that timing.

The merger is set to create a $27 billion-asset regional bank that has about $20.6 billion in deposits, $19.1 billion in loans, and 250 locations across nine states. The combined company would be the 8th largest lender in Ohio, based on deposit market share, and have a bigger presence in Indiana, WesBanco said.

In reviewing merger applications, the FDIC considers factors such as a transaction’s competitive effects, the involved banks’ financial and managerial resources and future prospects of the combined lender, the convenience and needs of the communities to be served, risks to banking system stability and involved banks’ anti-money laundering records. 

The regulator “found favorably on those factors” along with additional requirements that apply to an interstate merger transaction, the FDIC said.

The approval came a few days after FDIC Acting Chairman Travis Hill named improvements to the bank merger approval process as a priority in coming months. He expects the FDIC will replace last year’s policy update, in an effort to hasten the merger approval process.

“Improving the bank merger approval process is a high priority for the agency going forward,” the FDIC noted in granting approval of the WesBanco-Premier deal.

At WesBanco’s special shareholder meeting, about 85% of the votes cast approved the merger as well as the proposal to issue shares of WesBanco common stock; at Premier’s meeting, about 68% of the outstanding shares of Premier common stock voted in favor of the merger.

WesBanco raised about $200 million in capital to support the merger, including a $125 million investment from Wellington Management. Other investors include Glendon Capital Management and Klaros Capital. At completion, the investors will own an 8% stake in the combined bank.