Jim Dobbs

The two companies announced the deal more than a year ago and had anticipated closing it in the first half of 2023. But advocacy groups have urged regulators to withhold approval, arguing that it will hurt consumers.

A small bank stock index posted its biggest gain of the year in early November before that progress faded. What will it take for investors to sustain confidence in the sector?

Total loans at U.S. banks with less than $10 billion of assets grew by 1.9% in the third quarter, according to S&P Global Market Intelligence data. That was a slowdown from the previous quarter, and concerns about the viability of commercial real estate lending could dampen activity further.

The Champaign, Illinois-based company said it would pay $41.6 million to acquire Merchants and Manufacturers Bank Corp., which has five branches in the Greater Chicago area.

Bankers are hopeful that several factors could strengthen profits next year, including higher loan demand and more stable funding costs as the Fed holds the line on — or even lowers — interest rates.

West Plains Bank and Trust in Missouri, No. 11 on this year's Best Banks to Work For ranking, wins high marks for constructive training, employee development, team culture — as well as excellent benefits.

The $7.7 billion-asset federal credit union in East Lansing announced its third deal in as many months — the planned purchase of in-market peer Gabriels Community Credit Union. And it has two bank acquisitions pending.

The deal for SimplyBank, scheduled to be completed in the second quarter, would give First Financial in Terre Haute, Indiana, additional branches in Tennessee and its first presence in Georgia.

But high costs and any downturn in the economy could weigh on lenders and their commercial borrowers in coming months, economists caution.

Proceeds from the sale provide the bank with "flexibility to evaluate and pursue various strategic initiatives to redeploy capital in support of our core banking business," Evans CEO David Nasca said.

A.E.A. Federal Credit Union in Yuma said it would acquire West Valley National Bank in a bid to expand into Phoenix and Las Vegas.

Many banks tapped the brakes on mergers and acquisitions this year amid economic and regulatory challenges. But executives at banks with a history of dealmaking say conditions could be right for them to return to buying mode next year.

The island state's biggest banks — which reported lower profits in the third quarter — say it is too soon to fully assess the economic fallout from the deadly August wildfires. The rebuilding effort could boost near-term deposit growth and long-term loan demand, they said.

Amid intense regulatory scrutiny, market volatility and economic uncertainty, 10 bank M&A deals have been scrubbed so far this year after 13 were scuttled last year. Deal activity has risen slightly lately, but the new normal is hard to gauge.

The Indiana bank said it agreed to acquire CapStar Financial in an all-stock deal that would hasten its growth in Tennessee.

The Federal Reserve Board and state regulators signed off on the $1 billion deal, paving the way for a late 2023 closing. The approvals were significant given that other large combinations have run into trouble.

"We'll be taking steps to offset expense pressures," CEO Curtis Farmer told analysts after the company reported an 11% year-over-year jump in costs and falling profits.

The Tennessee bank said a $72 million charge-off tied to a borrower in bankruptcy shaved 10 cents per share off its earnings. Management downplayed the issue, calling it "idiosyncratic," and emphasized that it was growing its loan portfolio.

The Pittsburgh-based regional bank expects to save $325 million next year as it reduces its staff by 4%. Executives said the cuts are necessary because revenue has fallen amid a surge in interest rates and a decline in loan volumes.

Central Valley Community Bancorp's agreement to buy Community West Bancshares, slated to close in the second quarter, would create a $3.6 billion-asset bank in the Greater Sacramento region.