F.N.B. Corp. to Buy UB Bancorp for $117M

PITTSBURGH – F.N.B. Corporation and UB Bancorp announced this morning the signing of a definitive merger agreement for FNB to acquire UB Bancorp, including its wholly-owned banking subsidiary, Union Bank. The all-stock transaction is valued at $19.56 per share, or a fully diluted market value of approximately $117 million, based upon the closing stock price of FNB as of yesterday.

Union Bank, based in Greenville, North Carolina, has $1.2 billion in total assets, $1.0 billion in total deposits of which about 40% are non-interest bearing, and $0.7 billion in total loans and leases as of March 31. Union Bank operates 15 full-service banking offices in 12 counties across Eastern and Central North Carolina.

This merger further increases FNB’s presence in North Carolina, moving its proforma deposit market share to eighth in the state, while also adding low-cost granular deposits, which will continue to be value accretive in a rising rate environment, the company said.

Following the merger, on a proforma basis FNB will have $43 billion in total assets, $35 billion in deposits and $28 billion in total loans. Under the terms of the agreement, which has been unanimously approved by the boards of directors of both companies, stockholders of UB Bancorp will be entitled to receive 1.61 shares of FNB common stock for each share of UB common stock they own. The exchange ratio is fixed, and the transaction is expected to qualify as a tax-free exchange for UB Bancorp stockholders.

“Our partnership with Union Bank represents another step in our continued investment in North Carolina with proforma deposits growing to over $7 billion since we entered the market in 2017, said Vincent J. Delie Jr., chairman, president and CEO of FNB, in a prepared statement. “North Carolina has proven to be a growth engine for our company, and this new partnership with Union Bank will further leverage our investments in the market and accelerate our organic growth potential.”

In his prepared statement, Lee Burrows, chairman of Union Bank, said, “In FNB, we’ve found a like-minded partner committed to building meaningful relationships with its clients and communities. …”Our partnership will add meaningful scale and access to a comprehensive product offering and broader in-market expertise that we believe will result in an enhanced customer experience for our clients.”
FNB expects the merger to be 2% accretive to earnings per share with fully phased-in cost savings on a GAAP basis in addition to enhancing FNB’s profitability metrics.

The transaction is expected to be completed late this year after after satisfaction of customary closing conditions, including regulatory approvals and the approval of UB Bancorp’s stockholders. Union Bank will merge with and into FNB’s subsidiary, First National Bank of Pennsylvania.

BofA Securities Inc. is serving as financial advisor and Reed Smith LLP is serving as legal counsel to FNB. Piper Sandler & Co. is serving as financial advisor and Fenimore Kay Harrison LLP is serving as legal counsel to UB Bancorp.

An investor presentation will be available through the “About Us” section of FNB’s website by clicking on “Investor Relations” then “Investor & Analyst Presentations,” or in the filings of FNB on the SEC website.

Published by The Business Journal, Youngstown, Ohio.