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On October 25, 2019, Bar Harbor Bank & Trust of Bar Harbor, Maine, subsidiary of Bar Harbor Bankshares (NYSE: BHB), closed its assumption of deposits and purchase of loans, assets under management and eight branch locations in Central Maine from People’s United Bank. The transaction materially strengthens the presence of BHB in its home state and provides improved access to existing retail and commercial customers and entry into attractive new retail and commercial markets. The Greater Bangor market in Central Maine is contiguous to the Company’s home state footprint, with many existing customers and employees living and working in the area already.
Bar Harbor originally announced the acquisition of the eight branch locations in July 2019, which at the time included the assumption of approximately $287 million in deposits and the acquisition of $111 million in loans and approximately $284 million in wealth assets under management from People’s United. BHB agreed to pay a premium of 6.3% on the average total deposits as well as 1.2 times the annualized revenue from the wealth accounts. The transaction will be materially accretive to the earnings per share of BHB and improve the Company’s ROA, ROE and efficiency ratio. Cash received in the purchase will be used to repay wholesale borrowings, improving the bank’s cost of funds, net interest margin, balance sheet liquidity and interest rate sensitivity. Expected dilution to tangible book value will be earned back within five years.
Founded in 1887, Bar Harbor Bank & Trust provides full-service community banking with offices in all three northern New England states of Maine, New Hampshire and Vermont. The Company nearly doubled in size with its acquisition of Lake Sunapee Bank in 2017 and has continued to transform a large wholesale component of its balance sheet to core community banking business through strategic expansion and the hiring of seasoned bankers.
The press release and investor presentation for the transaction can be seen here by clicking on the respective links.
Griffin Financial Group, LLC served as exclusive financial advisor to Bar Harbor Bank & Trust in this transaction.
For more information on this transaction, please contact Richard Quad, Senior Managing Director and Head of the Financial Institutions Group, at 646.254.6387, or Jordan Winick, Vice President, at 610.205.6355.
