Susquehanna Bank bought by BB&T
Here we go again.
For the third time in five years, the sign on the outside of the bank building in Greencastle’s Center Square may be changing.
A Winston-Salem, N.C. financial holding company is seeking to acquire Susquehanna Bank, headquartered in Lititz and with a number of branches in Franklin County.
A Susquehanna spokesman told the Echo Pilot Wednesday that he doesn’t except much of a change for local customers other than the name.
BB&T Corporation and Susquehanna Bancshares, Inc. announced Wednesday, Nov. 12, the signing of a definitive agreement under which BB&T will acquire Susquehanna in a cash and stock transaction for total consideration valued at approximately $2.5 billion. This acquisition will significantly expand BB&T's presence in the mid-Atlantic region, according to a statement released by the company.
The bank building that holds the iconic clock tower in downtown Greencastle has been a whirlwind since 2008 when a merger with Tower Bank was proposed.
Tower purchased First National Bank of Greencastle in 2009. First National was established in 1864 and constructed its building in 1869. The clock was added in 1872.
Susquehanna took over Tower in 2011. After the acquisition, Susquehanna, which in 2005 had purchased the other longtime local bank in the town, Citizens National Bank (founded in 1901), closed the longtime location on North Carlisle Street and opted to move its in-town operations across the street, where it still functions at 40 Center Square as the local branch. There is also a Susquehanna branch in State Line.
Susquehanna, headquartered in Lititz, is a top 50 bank in the U.S. with $18.6 billion in assets, $13.6 billion in deposits and 245 banking offices in Pennsylvania, Maryland, New Jersey and West Virginia.
The deal, to be finalized in 2015 after shareholders and others approve the agreement, should not have much of an affect on Greencastle customers, Stephen Trapnell, Susquehanna corporate communications manager, told Echo Pilot during an interview Wednesday afternoon.
“There aren’t really any BB&Ts in the area, so this is an expansion for them,” he said. “The Susquehanna name will change, but customers will still deal with the same teams and staff they are used to. They will also have access to a wider branch network.”
Trapnell said both banks were community-oriented, and the support would continue.
“Our banks have many similarities in operation. Decision making is made close to the customers. And BB&T has robust employee volunteer initiatives.”
The management of the two systems are optimistic about the merge, as expressed in a press release.
"We are extremely excited to welcome our new clients and associates in these attractive markets to BB&T. Susquehanna's culture, commitment to its communities and business model are a strong fit with BB&T," said Chairman and Chief Executive Officer Kelly S. King.
"We look forward to being a part of BB&T's storied franchise," said William J. Reuter, Susquehanna's Chairman and Chief Executive Officer. "BB&T's expanded product offerings and resources combined with a stronger balance sheet will enable us to better serve our clients, associates and communities."
In connection with the acquisition, BB&T plans to establish three new banking regions encompassing certain markets in Pennsylvania and New Jersey. BB&T also plans to integrate its Baltimore region with Susquehanna's. These four regions are expected to be led by legacy Susquehanna executives. BB&T operates its community banking client service model through banking regions that drive faster, simpler, more effective client service.
"Similar to our recently announced market expansion acquisitions in the Dallas, Houston and Cincinnati markets, Susquehanna expands our franchise into a contiguous, attractive region that presents an exciting opportunity for us. The diversity of our markets is a key element of our long-term success," said King.
Reuter and Christine Sears, current Susquehanna Board members, will join BB&T's Board of Directors upon closing of the transaction, according to the news release. It also said the BB&T plans to continue Susquehanna's tradition of commitment and service to its communities by creating a $10 million economic development fund to ensure ongoing support of the Lancaster community.
Under the terms of the agreement, which was approved by the board of directors of each company, shareholders of Susquehanna will receive as merger consideration 0.253 shares of BB&T common stock and $4.05 in cash for each share of Susquehanna common stock. The merger consideration is valued at $13.50 per share based on the average closing price of BB&T over the 45 trading days ending on November 10.
BB&T expects to incur pre-tax merger and integration costs of approximately $250 million and expects to achieve annual cost savings of approximately $160 million (approximately 32 percent of Susquehanna's non-interest expenses).
BB&T expects this acquisition to be accretive to earnings per share in the first full year excluding one-time charges and expects the transaction to exceed its IRR hurdle.
This acquisition is subject to customary closing conditions including regulatory approvals and approval of Susquehanna shareholders.
About BB&T is one of the largest financial services holding companies in the U.S. with $187 billion in assets and market capitalization of $26.8 billion, as of September 30, 2014. Based in Winston-Salem, N.C., the company operates 1,842 financial centers in 12 states and Washington, D.C., and offers a full range of consumer and commercial banking, securities brokerage, asset management, mortgage and insurance products and services. A Fortune 500 company, BB&T has been recognized for outstanding client satisfaction by J.D. Power and Associates, the U.S. Small Business Administration, Greenwich Associates and others. More information about BB&T and its full line of products and services is available at bbt.com.
About Susquehanna is a financial services holding company with total assets of approximately $18.6 billion. Headquartered in Lititz, Susquehanna provides banking and financial services at 245 branch locations in the mid-Atlantic region. Through Susquehanna Wealth Management, Susquehanna offers investment, fiduciary, brokerage, insurance, retirement planning, and private banking services, with approximately $7.6 billion in assets under management and administration. Susquehanna also operates an insurance brokerage and employee benefits company, a commercial finance company, a vehicle leasing company, a mortgage division, and a settlement services company. Investor information may be requested through Susquehanna's website at www.susquehanna.net