Home Bancshares Inc. announced Monday after the close of market that it has acquired another Fort Lauderdale bank in a $88.5 million cash-and-stock deal, expanding the fast-growing Conway-based banking group’s footprint in the South Florida region.
Home Bancshares, the parent company of Centennial Bank, said the definitive agreement and plan of merger will allow the Arkansas financial group to acquire Ft. Lauderdale-based Giant Holdings Inc., a bank holding company for a locally-owned operating under the “Landmark Bank” moniker.
Under the terms of the deal, GHI’s Landmark will merge into Centennial, and shareholders of GHI will receive proceeds from the transaction consisting of $18.5 million in cash and $70 million of Home common stock. GHI is a privately-held local community bank founded by Jeff Roschman, chairman of the bank’s parent company and a South Florida private equity investor who has developed more than 100 commercial properties in the coastal region.
“The acquisition of Landmark allows us to increase our market share in the Ft. Lauderdale area. We consider this acquisition a smart deal, and it is immediately accretive to diluted earnings per share, book value and tangible book value,” said John Allison, Home Bancshares’ Chairman. “We have remained disciplined in our pricing in order to provide our shareholders added value on day one, while adding a great bank to our company. I personally look forward to working with Jeff Roschman, GHI’s Chairman, and his fine team of bankers. Jeff and I share the common interest of continuing to build this company.”
GHI currently operates six local branches in the Ft. Lauderdale area. At the end of the third quarter, Home Bancshares operated 77 local bank branches in Arkansas, 59 in Florida, six in Alabama and one in New York City.
“Together, with an expanded range of products and Home’s history of strong financial performance, we will be able to serve an even wider array of customers in Southeast Florida,” said Landmark President and CEO Perry LaCaria.
As of September 30, 2016, GHI had approximately $463 million in total assets, $335.2 million in loans, and $368.2 million in deposits. After the deal closes, Home Bancshares will have nearly $10.2 billion in total assets and reach a long-awaited milestone of becoming a regional bank.
With assets now over $10 billion, Home Bancshares has now reached the key financial touchstone established by the Dodd-Frank Wall Street Reform and Consumer Protection act as the regulatory baseline between super-community banks and larger regional banking groups.
Little Rock-based Bank of the Ozarks topped the $10 billion mark in late 2015 and now has assets exceeding $18.4 billion. Pine Bluff’s Simmons First National, which recently reported third quarter profits of more than $23.4 million, has assets of more than $8.1 billion after acquiring a Tennessee community bank for $777 million in early September.
The acquisition of the South Florida community bank is expected to close in the first quarter of 2017 and is subject to GHI shareholder approval, regulatory approvals, and other customary conditions, officials said. After the Landmark deal closes, Home Bancshares will have acquired more than a dozen Florida banks since the Great Recession, mostly through the FDIC’s fire sale for distressed and near-bankrupt banks.
For now, Centennial and Landmark’s Florida customers should continue to do business at their current local branches, officials said. However, customers of both banks will be able to each other’s ATMs free of charge in the near future.
At the close of business Monday, Home Bancshares stock ended up 66 cents or $3.10 at $21.97 on the Nasdaq stock exchange. The publicly traded Arkansas bank recently reported third quarter earnings of $43.6 million, continuing the bank’s consecutive winning streak of profitable quarters that has lasted more than five years.