A Muncie-based bank has completed its $140 million acquisition of Citizens Financial Bank, which has been making loans and taking deposits in Northwest Indiana since 1934.
Munster-based Citizens Financial Bank is now merged into the bigger First Merchants Bank, the second-largest bank headquartered in Indiana.
The combined bank now has $5.5 billion in total assets and 95 locations in Indiana, Illinois and Ohio. After the merger, First Merchants now has $3.5 billion in loans and $4.3 billion in deposits.
"Citizens' clients will now have access to expanded product and service options including trust services, wealth management and insurance," said First Merchants CEO Michael Rechin. "With the capital resources and lending capacity that First Merchants provides, it will enable us to focus on growth in the Northwest Indiana and Northeastern Illinois community markets, both logical geographic extensions of the First Merchants franchise. We are excited about the addition of new markets to serve and new bankers to manage our growing business."
Shareholders of both banks approved the merger. Citizens Financial Bank shareholders will receive 0.65 shares of First Merchants stock for each share of common stock they hold.
Citizens Financial had assets of $1.1 billion and 20 branches across Northwest Indiana and Chicago's south suburbs. President and CEO Daryl Pomranke will continue to run the local banks, which have been grouped as the Lakeshore Region of First Merchants Bank.
More than 80 Citizens Financial employees in operations, information technology and other support roles are being laid off as a result of the merger, since First Merchants already has workers doing those jobs. Such layoffs are common when big banks merge with smaller ones.
First Merchants plans to continue to employ Citizens' tellers, loan officers and salespeople, so customers will interact with the same bankers they always have.
"We are excited about becoming part of the First Merchants family, and believe this partnership benefits our clients, shareholders and communities," Pomranke said. "Our clients will now have access to a broader network and expanded products and services, while still enjoying community banking service delivered by people they know and trust."
Citizens Financial has striven to be the community bank of choice in the area, and thinks First Merchants can help the bank realize that goal, Pomranke said.
"Our bankers look forward to taking advantage of new product capabilities and continuing to build momentum with our clients as First Merchants," he said. "The core values of both companies share a commitment to local decision-making, personal service, long-term relationships and community involvement."
The full integration is expected to be complete in the first three months of 2014.