Equity Bancshares in Wichita, Kansas, has agreed to acquire Rockhold Bancorp, the holding company of Bank of Kirksville in Missouri, for $44.3 million in cash.
Rockhold had previously agreed to sell to Fidelity Federal Bancorp but the companies mutually agreed earlier this year
The deal to buy Bank of Kirksville, expected to close in the first quarter, would give Equity eight branches in Missouri. Bank of Kirksville currently operates branches in north-central Missouri, including three in Kirksville and one each in LaPlata, Downing, Memphis, Macon and Moberly. Bank of Kirksville had $406 million of assets, $344 million of deposits, and $122 million of loans at the close of the third quarter.
"We couldn't be more pleased to add another strong community bank to our network and continue to serve our Missouri customer base with additional locations, technology, and customized solutions for businesses and families," Brad Elliott, Equity chairman and CEO, said in a joint press release announcing the deal Wednesday. "Our teams continue to work diligently to add customers, colleagues, and market locations within our four-state footprint, and we're pleased to enter Kirksville and serve a vibrant customer base."
The $4.9 billion-asset Equity reported third-quarter deposits of $4.1 billion and loans of $3.3 billion. The combined bank would have a branch network of 74 locations, including 23 in Missouri, and $5.4 billion of total assets, according to the release. In addition to Missouri and its home state, Equity also operates in Arkansas and Oklahoma.
Equity expects the deal to be 36 cents, or 12%, accretive to diluted earnings per share in 2024, and 45 cents, or 14.3%, accretive in 2025. It expects to earn back tangible book value in just over one year.
Should the deal close as planned, Norman Belitz, CEO of Bank of Kirksville, would join Equity Bank as regional market president.
"We are proud of our newest chapter, joining Equity Bank. Each bank has roots in community values, and dedication to Missouri customers," Belitz said in the release. "Equity is committed to our region and serves customers like ours with sophisticated loan, deposit and online banking products."
Equity also announced on Wednesday the sale of $442 million of available-for-sale investment securities, making it the
Equity said its sale would generate an after-tax loss of approximately $38.2 million. The assets included are mostly treasury, agency and mortgage-backed securities with a weighted average yield of 1.33%. The proceeds will be re-deployed in cash, investments and loan assets with an expected yield of greater than 5%.
Equity expects the sale to bring in additional annual interest income of $16.2 million, producing estimated earnings per share accretion of 81 cents in 2024.
