The signed definitive agreement would allow State Bank Financial, the parent company of State Bank and Trust Co., to purchase Augusta-based Georgia-Carolina Bancshares Inc. and subsidiary First Bank of Georgia for about $82 million in cash and stock transaction, or $22.35 per share. The exchange amount, broken down by 60 percent in stock and 40 percent in cash, could change at the time of the merger based on State Bank Financial common stock prices.
“This is a great point of entry for us into the Augusta market,” said Joe Evans, State Bank Financial chairman and CEO, during a Tuesday conference call. “First Bank of Georgia is large enough to be meaningful, but small enough to still grow and take significant market share.”
The pending transaction, Evans said, will likely give First Bank customers access to State Bank services, such as treasury and cash management and payroll banking. On the other end, State Bank, which is in the process of expanding its mortgage services, will be able to utilize First Bank’s “mature existing mortgage platform.”
“We believe there’s significant growth for us in this market as First Bank of Georgia officers will be able to take advantage of State Bank’s higher capital base and target larger relationships than they’ve previously been able to,” Evans said.
State Bank and Trust Co., founded in 2009, reported $2.6 billion in assets as of March 31 and has 20 branches in metro Atlanta, Macon and middle Georgia. In April, State Bank Financial announced plans of acquiring Bank of Atlanta for about $25 million by late 2014. Bank of Atlanta, headquartered in Midtown Atlanta with one other office in Duluth, Ga., would immediately merge into State Bank Financial after the transaction closes.
The agreement between State Bank Financial and First Bank has been unanimously approved by both companies’ boards of directors and is expected to close during the first quarter of 2015.
“It provides us the ability to provide a great array of products, services and technology to our customers in Augusta," said First Bank President and CEO Remer Brinson III, who also was named in June as chairman of the Georgia Bankers Association.
The First Bank of Georgia name will continue to be seen across the area even after the deal is completed. Evans said he intends to keep the bank’s charter intact until the two entities fully build trust, open lines of communication and develop a mutual understanding of each’s respective systems. After that, the complete consolidation will occur, he said.
“We will maintain the First Bank of Georgia name initially, and planfully and deliberately introduce the State Bank brand name in the Augusta market at a later time,” Evans said. “We’re acquiring a very good bank. First and foremost, we don’t want to mess that up. When you buy a quality bank, maintaining culture and a sense of community is very important.”
First Bank of Georgia originally began as McDuffie Bank & Trust Co., with the first office opening in Thomson in 1989. After Georgia-Carolina Bancshares was chartered in 1997, the bank name changed to First Bank of Georgia in 1998. A year later, in 1999, the bank opened its first two Augusta offices at the Daniel Village and West Town shopping centers.
Now headquartered on Wheeler Road in Augusta, First Bank operates seven branches across metro Augusta and offers mortgage services in both Augusta and Savannah.
Georgia-Carolina Bancshares reported First Bank had total assets of $523 million at the end of March, representing an increase of $6.6 million from the beginning of the year. It posted a first-quarter profit of $852,000.
First Bank follows Georgia Bank & Trust, with 12 local offices, as the second largest locally owned and operated community bank in the metro area.
The final transaction between the two banking institutions is pending regulatory approvals and consent from Georgia-Carolina Bancshares shareholders. State Bank Financial has filed a registration statement for the proposed transaction with the U.S. Securities and Exchange Commission.