by Gwen Moritz
Posted 10/15/2010 05:14 pm
Updated 11 months ago
Simmons First National Bank of Pine Bluff has entered into an agreement with the Federal Deposit Insurance Corp. to acquire the deposits, most of the assets and nine branches of Security Savings Bank FSB of Olathe, Kan., the FDIC announced late Friday.
It is the second foray outside of Arkansas by the flagship bank of publicly traded Simmons First National Corp., which made another FDIC-assisted acquisition in Missouri in May.
As of June 30, Security Savings Bank - a thrift rather than a commercial bank - had approximately $508 million in assets and $397 million in total deposits, according to the FDIC. Simmons is not paying the FDIC a premium for the deposits.
As has become standard in failed bank deals, the FDIC and Simmons entered into a loss-share agreement on most of Security's assets - $334.2 million to be exact
Security's nine branches will reopen on Saturday as branches of Simmons First National Bank, which is the largest of Simmons First National Corp.'s eight bank charters. Simmons announced this week that it would streamline its charter structure so that only the Pine Bluff bank will retain its national charter.
Security Savings Bank, which was chartered in 1956, lost $21.35 million in 2009 and had posted a net loss of $14 million for the first two quarters of 2009. The subject of a cease-and-desist order from the Office of Thrift Supervision in August 2009, Security was hit with an order for "prompt corrective action" in August 2010.
Simmons First National Bank, by contrast, earned $12.7 million in 2009, and the holding company earned $25.2 million last year. Simmons First National Corp. stock (Nasdaq:SFNC) closed at $28.55 on Friday, before the acquisition was announced. That was down $0.35 from Thursday's close
The corporation, which issued more than $70 million in stock in hopes of making such acquisitions, said the acquisition was expected to be "slightly accretive to both net income and diluted earnings per share" and "slightly accretive to book value per share and tangible book value per share."