American Fork and St. George—People’s Utah Bancorp and Town & Country Bank, Inc. Thursday jointly announced the signing of a definitive agreement to merge Town & Country Bank, a community bank based in St. George Utah, into People’s Intermountain Bank, a wholly owned subsidiary of PUB. Town & Country Bank was established in 2008 with one branch in St. George, Utah and one loan production office in Sandy, Utah and has a strong focus on serving business customers. As of March 31, 2017, Town & Country Bank had total assets of $135.1 million, gross loans of $97.3 million and total deposits of $119.7 million.
The boards of PUB and Town & Country Bank unanimously approved the transaction, which is subject to required regulatory approvals, customary closing conditions, and shareholder approval. The transaction provides for the payment to Town & Country Bank shareholders of $4.28 per share in cash and 0.2978 shares of PUB common stock. Based on the closing price of $25.55 for PUB shares on May 30, 2017, the transaction would result in an aggregate value of $20.9 million or $11.89 per fully diluted Town & Country Bank common share. Town & Country Bank shareholders may also receive additional cash consideration at closing subject to certain closing conditions. As of March 31, 2017, Town & Country Bank had tangible equity of $14.7 million.
The Town & Country Bank office and PUB’s Bank of American Fork branch in St. George are expected to be consolidated in January 2018. Upon consolidation, the combined division will operate under the name “People’s Town & Country Bank”. Bank of American Fork branches in other areas will not be affected by this St. George-area name change. The Town & Country Bank’s Sandy loan production office is expected to be consolidated with the current Bank of American Fork Sandy branch and will operate under the name Bank of American Fork. This is part of a larger bank-wide strategy to establish a community-banking network with local names throughout Utah and potentially in adjoining states.
“We appreciate the unique style of customer service that Town & Country Bank has created. We look forward to working with customers and our associates to preserve some of the most important aspects of that style. The merger will add substantial capital, new technologies and products to Town & Country Bank customers that have not been available before. It will also allow Town & Country Bank to increase lending limits that will allow customers to do larger projects. The new combined People’s Town & Country Bank division in St. George is expected to have loans of approximately $133 million and deposits of $128 million. The People’s Town & Country Bank division will allow us to continue the community-banking tradition so important to American small business while spreading the high regulatory and operating costs of banking over a broader base,” said Richard T. Beard, President and CEO of People’s Utah Bancorp.
Kurt Johnson, Chairman of the Board of Town & Country Bank said, “We believe this combination will be highly beneficial to our customers. They will have access to the additional resources that will come from joining the People’s Utah Bancorp family including mortgage services offered by People’s Intermountain Bank Mortgage. The standards for customer service at both banks is very high. Our customers should expect the personal service we have been known for with additional options and resources to choose from.”
According to MetroStudy, housing dynamics in the St. George and Mesquite, Nevada, market area are very strong. As of March 2017, job growth showed a year-over-year net increase of 3,100, unemployment was 3.7 percent compared to the national rate of 4.5 percent, and there were 1,716 new home starts, among the highest months since 2008.
PUB was advised in the transaction by D.A. Davidson & Co. as financial advisor and Dorsey & Whitney LLP as legal counsel. Town & Country Bank was advised by Sheshunoff & Co., as financial advisor, and Jones Waldo Holbrook & McDonough, PC as legal counsel.