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HeritageBank of the South to acquire Frontier Bank from FDIC

US community-oriented lender HeritageBank of the South has inked a definitive whole-bank purchase and assumption agreement with the Federal Deposit Insurance Corporation (FDIC) to acquire Frontier Bank in LaGrange, Georgia.

The Georgia Department of Banking and Finance closed Frontier Bank and, by Order of the Georgia Superior Court, appointed FDIC as the receiver.

Further terms of the transaction have not been disclosed.

Based on the terms of the deal, three Frontier Bank’s branches located between LaGrange and Auburn, as well as six other branches located in south and southeast of Birmingham, Alabama, will be transferred to the acquirer.

Following completion of the transaction, the acquirer will assume nearly $224m in deposits and acquire almost $111m in loans.

HeritageBank of the South will not purchase any of Frontier Bank’s other real estate owned and this transaction does not involve a loss-share agreement, but is subject to an asset purchase discount of $34.8m.

After acquisition, the acquirer will have 29 banking branches and depositors of Frontier Bank will automatically become depositors of HeritageBank of the South, and deposits will continue to be insured by the FDIC.

HeritageBank of the South had total assets of approximately $1.1bn and total stockholders’ equity of approximately $121m as of 31 December 2012.