News Summary
Investar Bank is making headlines with its recent acquisition of First National Bank in Texas for $83.6 million. This strategic move marks Investar’s largest acquisition, enhancing its presence in the Dallas-Fort Worth area. With First National’s seven branches, Investar seeks to broaden its customer base, manage over $4 billion in assets, and leverage the strong Texas market. The merger is expected to complete by the end of 2025, promising an enriched banking experience for First National customers while reinforcing Investar’s growth strategy.
Texas: Investar Holding Corp. to Acquire First National Bank for $83.6 Million
Investar Holding Corp. has announced its plans to acquire First National Bank, based in Texas, in a deal valued at $83.6 million in cash and stock. This significant acquisition represents Investar’s entry into the expanding Dallas market and marks its largest acquisition to date.
Details of the Acquisition
The deal involves the acquisition of Wichita Falls Bancshares, the parent company of First National Bank. As of now, Investar operates 29 branches and employs 329 individuals across Louisiana, east Texas, and Alabama. After the completion of this acquisition, Investar will possess more than 36 branches, bringing its total assets to over $4 billion and deposits to $3.5 billion.
To facilitate the purchase, Investar has raised $32.5 million through the sale of Class A Preferred stock. As of March 31, the company reported $2.3 billion in deposits and $2.7 billion in assets. Meanwhile, First National Bank operates seven branches in north Texas, boasting $1.2 billion in deposits and $1.5 billion in assets, solidifying the strategic impact of this deal on Investar’s growth in Texas.
Strategic Objectives and Market Position
This acquisition aligns with Investar’s broader multistate strategy, which has included several smaller acquisitions in the past: all under $250 million in assets. This strategy has allowed the bank to expand its footprint strategically while retaining a focus on community banking. Prior to this acquisition, Investar had positioned itself as the 13th largest bank in Louisiana, holding less than 2% of total deposits in the state.
The move into Texas is particularly timely, given the region’s growth potential, especially in the Dallas-Fort Worth Metroplex, where First National operates five branches. Following the acquisition, more than one-third of Investar’s total assets will be based in Texas, strengthening its presence in the growing North Texas market.
Expected Benefits and Future Outlook
Upon the closing of the deal, anticipated for the fourth quarter of 2025, Investar’s projected earnings for 2026 are expected to reach $3.08 per share, reflecting an increase of 35%. This growth is expected to enhance Investar’s financial strength and overall resource capacity, ultimately leading to improved service offerings for its customers.
David Flack, President of Wichita Falls, underscored that the merger would provide customers with an enhanced suite of products and services while ensuring that existing branches and staff remain intact. This continuity will be crucial in maintaining customer relationships as Investar transitions First National Bank to its brand.
Following the acquisition, Investar plans to sell $200 million in mortgages to effectively manage residential loan concentration and corporate debt. This strategy aims to further bolster the bank’s financial position as it navigates its expansion into the Texas market.
Company Background
Investar began its journey post-Hurricane Katrina and has historically focused on acquiring smaller banks with assets of $500 million or less. The bank went public in 2014, moving 3.3 million shares and grossing $46 million at a time when its assets totaled $674 million.
In summary, the acquisition of First National Bank illustrates Investar’s commitment to expanding its footprint in Texas and enhancing its community banking services while looking forward to a robust financial future in one of the nation’s most competitive banking markets.
Deeper Dive: News & Info About This Topic
- Business Report: Investar Bank Agrees to Acquire First National Bank in Texas
- Wikipedia: Investar Bank
- The Advocate: Company Behind Baton Rouge Bank Expands into North Texas
- Google Search: Investar Bank acquisition
- American Banker: Louisiana Bank to Enter Dallas with Second Texas Deal
- Encyclopedia Britannica: Banking in Texas
- Investing.com: Investar to Acquire Wichita Falls Bancshares in $836 Million Deal
- Google News: Investar Bank Texas
- American Banker: Why Private Investors are Scooping Up Small Banks
