ALBANY, Ga. HeritageBank of the South, a former credit union-turned-mutual savings bank, on Friday agreed to purchase Frontier Bank, a $260-million LaGrange, Ga., bank shuttered by the FDIC and the fourth bank failure acquired by the one-time credit union.
The FDIC-subsidized deals have grown the credit union convert, known until 2001 as AGE FCU, from $320 million in assets at the time of the conversion from a credit union to $1.4 billion and 29 branches throughout southern Georgia and Alabama.
The former credit union was chartered in 1955 to serve employees of CSX Railroad.
The latest deal for the credit union-convert comes as members of HarborOne CU, the second-biggest credit union in Massachusetts, are expected to approve the conversion of the $2-billion Brockton, Mass., credit union to a bank at a special meeting tonight.
Leonard Dorminey, president and CEO of Heritage Financial Group, the holding company for HeritageBank, who engineered the 2001 conversion from credit union, said the latest deal gives Heritage an opportunity to enter the Birmingham, Ala, market. “We look forward to the opportunity to enter the Birmingham market, one of the major metropolitan markets in the state where we hope to differentiate HeritageBank of the South as a leader in community banking and build a solid banking platform for future growth,” said Dorminey.
Friday’s FDIC-assisted deal gives about $224 million in deposits and about $111 million in loans. The deal does not involve a loss-share agreement, but was subject to an asset purchase discount of $34.8 million. The cost to the FDIC insurance fund for the purchase and assumption deal is estimated to be $51.6 million.
Heritage has acquired three other bank failures since 2009, including $50-million Tattnall Bank in Reidsville, Ga., $165-million First Southern National Bank, Statesboro, Ga., and $215-million Citizens Bank of Effingham, Springfield, Ga.
