Peoples Bank has served Northwest Indiana for 108 years and now is making its first push to grow out of state in an era of increasing bank consolidation.
NorthWest Indiana Bancorp, the parent company of the Munster-based Peoples Bank, has reached an agreement to purchase First Personal Bank of Orland Park, Illinois, for $15.6 million in cash and stock. First Personal shareholders are being paid a 34 percent premium over tangible book value.
Peoples Bank will take over the 19-year-old Illinois bank, which has assets of $147 million and three branches in Orland Park, Lemont and Chicago.
“As we welcome First Personal’s customers and employees to Peoples Bank, we achieve a strategic goal of competing in the I-80 economic corridor stretching from Northwest Indiana across the state line into south suburban Chicagoland," Peoples Bank President and CEO Ben Bochnowski said. "This acquisition is a natural fit with strong benefits expected to accrue to our shareholders upon the close and integration of the merger."
The merger will boost Peoples Bank's assets past the $1 billion mark to $1.1 billion and give it a foothold in the south suburban market, where there's been a lot of commercial and industrial development.
“The south suburban Chicagoland market is a natural extension of our home markets in Northwest Indiana, and a market where we already have a significant customer base," Bochnowski said. "It shares the same cultural influences with Chicago while maintaining a unique community presence."
The merger is expected to be completed by the third quarter of this year, pending regulatory approval. First Personal CEO Randy Schwartz will stay on to work on the integration of the banks' back-office systems and culture, as well as to introduce First Personal customers to the Peoples Bank brand.
“First Personal Bank was founded on the principal of providing its customers with the best banking experience they’ve ever had,” Schwartz said. “We are excited to be joining with Peoples Bank so that we can continue giving that best banking experience to our existing customers, but now with an expanded product offering and more full service locations.”
"Peoples Bank is excited to work with Randy Schwartz and the First Personal team to deliver the community banking mission that has sustained Peoples Bank for over 100 years, to help our customers and communities be more successful through our shared values of stability, integrity, community and excellence," Bochnowsk said. "Our organization is committed to creating shared value for all of our stakeholders — shareholders, customers, employees, and the communities we serve."
The acquisition is expected to give Peoples Bank an added $0.51 in earnings per share in 2019.