Harrell Bancshares to Acquire Two Benton County Signature Branches

Northwest Arkansas continues to be a hot spot for banking in the state, despite significantly slower growth than was seen in 2004 when competing investor groups started three new institutions.

One of those "new" banks, Signature Bank of Arkansas, will sell two of its Benton County offices this week to First Bank of Hampton.

The Rogers and Siloam Springs offices will reopen as First Bank on Monday, said Jon Harrell, president of the Rogers bank.

Harrell said terms will not be disclosed, but said First Bank will acquire about $75 million in deposits and about $75 million in assets in the deal.

First Bank was known as Calhoun County Bank until about 30 days ago, when it received approval from the Arkansas State Bank Department to change its name.

Harrell, whose family owns Harrell Bancshares Inc. of Camden, will remain the Rogers president and said Tim McCord will be the Siloam Springs president.

As of June 30, the Rogers branch had $21.28 million in deposits and the Siloam Springs branch had $66.92 million in deposits.

Chance to Expand

Randy Dennis, president of DD&F Consulting Group of Little Rock, frequently helps banks with acquisitions and transactions. He is not involved in the Signature-First Bank deal, but said current branch sales are getting a 1 percent to 4 percent premium on deposits, depending on several factors.

"Our small community bank of south Arkansas has been looking for a opportunity to expand," Harrell said. "We'll be poised to do business, we're a solid and strong performing bank and we'll offer competitive rates."

First Bank does not have any plans to expand into Washington County in the immediate future, Harrell said.

A total of 18 Signature employees will transition to First Bank.  

A Bounce Back

Phil Foster, president and CEO of First Bank speaking from his Camden office, said Northwest Arkansas has "had some difficult times, but we believe it's an area that will bounce back and we're excited to be up there."

The bank's loan portfolio contains a lot of timber industry-related, consumer and residential loans, Foster said. Commercial is much slower in that part of the state, he said.  

Gary Head, chairman and CEO of White River Bancshares Inc., the holding company for Signature, did not immediately return a phone call.

According to the Federal Deposit Insurance Corp., First Bank had six offices in three counties, with $178.6 million in total assets and $154.3 million in deposits as of June 30.

The bank reported total net income of $856,000 for the first nine months of the year, according to its call report on file with the Federal Financial Institutions Examination Council.

The transaction will set a new record of deposit-taking banks doing business in Benton and Washington counties. There now will be 31 unique banks competing for a total of $7.07 billion in deposits (a June 30 number).

The Rogers offices of Intrust Bank NA of Kansas began taking deposit in late 2009 and Great Southern Bank of Springfield, Mo. began taking deposits in May of this year. Both had operated loan production offices in Benton County for several years.

By comparison, there were 28 banks in June 2007 and total two-county deposits of $8.46 billion. But the 2007 number was skewed by ANB Financial's deposits, much of which were brokered to keep up with its lending.

In 2005, there were 24 banks doing business in Benton and Washington counties, competing for a little more than $6 billion in deposits.