AMCORE (AMFI) To Sell 12 Branches to Midland States Bank
AMCORE Bank, N.A., a wholly-owned subsidiary of AMCORE Financial, Inc. (NASDAQ: AMFI), today announced that it has reached a definitive agreement with Midland States Bank of Effingham, IL, to sell 12 branches and two stand-alone drive-ups. The branches are located in Dixon, Freeport, Mendota, Oregon, Peru, Princeton, Rock Falls and Sterling.
The transaction includes approximately $480 million in loans, $540 million in deposits and sweep accounts, up to $400 million in trust and brokerage account relationships, as well as the branch facilities, related fixed assets and leases. In connection with the sale, AMCORE will receive a 1.5% deposit premium and a $1.5 million trust account premium. The transaction, which is subject to regulatory and other customary closing conditions, is expected to close in first quarter 2010.
In making the announcement, AMCORE Chairman and Chief Executive Officer William McManaman said, "The sale of these branches, when completed, demonstrate that our rebuilding efforts continue to move forward and remain on track."
AMCORE recently reported several events that will improve its capital position, including the sale of $135 million in non-strategic, non-relationship loans, the completed sale of four rural Wisconsin branches in November, and recent tax legislation that will result in a federal income tax refund of $25 to $30 million.
"As the result of those combined actions to improve capital, we would expect that the bank will no longer be deemed significantly undercapitalized for regulatory purposes at the end of 2009," said Mr. McManaman. "Assuming economic conditions in our markets stabilize, and that the transaction with Midland States Bank closes at the end of the first quarter 2010 and its benefits are fully realized, we expect that the bank would be adequately capitalized and approaching well-capitalized."
The transaction includes approximately $480 million in loans, $540 million in deposits and sweep accounts, up to $400 million in trust and brokerage account relationships, as well as the branch facilities, related fixed assets and leases. In connection with the sale, AMCORE will receive a 1.5% deposit premium and a $1.5 million trust account premium. The transaction, which is subject to regulatory and other customary closing conditions, is expected to close in first quarter 2010.
In making the announcement, AMCORE Chairman and Chief Executive Officer William McManaman said, "The sale of these branches, when completed, demonstrate that our rebuilding efforts continue to move forward and remain on track."
AMCORE recently reported several events that will improve its capital position, including the sale of $135 million in non-strategic, non-relationship loans, the completed sale of four rural Wisconsin branches in November, and recent tax legislation that will result in a federal income tax refund of $25 to $30 million.
"As the result of those combined actions to improve capital, we would expect that the bank will no longer be deemed significantly undercapitalized for regulatory purposes at the end of 2009," said Mr. McManaman. "Assuming economic conditions in our markets stabilize, and that the transaction with Midland States Bank closes at the end of the first quarter 2010 and its benefits are fully realized, we expect that the bank would be adequately capitalized and approaching well-capitalized."
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