First Citizens Bank takes over Mountain 1st Bank in $10 million deal

From Charlotte Business Journal:

First Citizens Bank & Trust will buy Hendersonville-based 1st Financial Services Corp. in a $10 million deal, the two banks announced Wednesday.

Raleigh-based First Citizens will pay $8 million to the U.S. Treasury to repay 1st Financial’s Troubled Asset Relief Program bailout. It will pay an additional $2 million to 1st Financial’s shareholders. 1st Financial is the parent company of Mountain 1st Bank & Trust Co.

1st Financial operates 12 branches in western North Carolina communities through Mountain 1st Bank, with $692 million in assets, $669 million in deposits and $363 million in loans as of June 30. The Mountain 1st branches are in Asheville, Brevard, Columbus, Etowah, Fletcher, Forest City, Hendersonville (two branches), Hickory, Marion, Shelby and Waynesville. With completion of the merger, Mountain 1st Bank branch offices will become First Citizens Bank branches.

Read more here.

From First Citizens’ press release:

First Citizens Bank and 1st Financial Services Corporation Announce Merger Agreement

RALEIGH and HENDERSONVILLE, N.C., Aug. 28, 2013 (GLOBE NEWSWIRE) —
First-Citizens Bank & Trust Company (known as First Citizens Bank) and
1st Financial Services Corporation announced today the signing of a
definitive merger agreement. 1st Financial Services Corp. provides
commercial banking products and services through its subsidiary,
Mountain 1st Bank & Trust Company.

This agreement provides for the merger of Hendersonville, N.C.-based
1st Financial Services Corp. and Mountain 1st Bank into First Citizens
Bank, which is headquartered in Raleigh, N.C. The announcement was made
jointly by Frank B. Holding Jr., chairman and chief executive officer
of First Citizens Bank, and Michael G. Mayer, chief executive officer
of 1st Financial Services Corp. and Mountain 1st Bank.

The agreement has been approved by the Boards of Directors of all three
companies. The transaction is expected to close no later than the first
quarter of 2014, subject to the receipt of regulatory approvals and the
approval of 1st Financial Services Corp. shareholders.

Under the terms of the agreement, cash consideration of $10 million
will be split between the U.S. Treasury, which will receive $8 million
of the cash consideration in order for 1st Financial Services Corp. to
exit from the federal TARP program, and common shareholders of 1st
Financial Services Corp., who will receive $2 million.

1st Financial Services Corp. operates 12 branches in western North
Carolina communities through Mountain 1st Bank, with $692 million in
assets, $669 million in deposits and $363 million in loans as of June
30, 2013. The Mountain 1st branches are located in Asheville, Brevard,
Columbus, Etowah, Fletcher, Forest City, Hendersonville (two branches),
Hickory, Marion, Shelby and Waynesville. Customers should bank as they
normally do at their existing branches. Pending completion of the
merger, Mountain 1st Bank branch offices will open as First Citizens
Bank branches.

Frank B. Holding Jr., chairman and CEO of First Citizens, said: “This
agreement is a significant opportunity for us to expand our presence in
our home state of North Carolina. We currently have a vibrant branch
network and customer base throughout western North Carolina, and we
look forward to the prospects of building on this foundation in an
important market for us.

“We’ve provided financial services in North Carolina for 115 years,”
Holding said. “Customers value our personal service, our dedication to
soundness and the full range of products and services we offer. We
expect to enhance our footprint in western N.C., establish new
relationships and create an even stronger bank for those we serve.”

Michael G. Mayer, CEO of 1st Financial and Mountain 1st, said: “We
welcome the opportunity to merge into First Citizens. Our companies
have a shared commitment to providing outstanding service and building
strong relationships in the communities we serve. Customers will
benefit from First Citizens’ century-long dedication to safety and
stability, a more robust line of products and a greater overall
capacity to serve their financial needs. It is an attractive agreement
for our company and our constituents.”