Community Bank System in DeWitt, N.Y., has agreed to buy Steuben Trust in Hornell, N.Y.
The $11.6 billion-asset Community Bank System said in a press release Monday that it will pay $106.8 million in cash and stock for the $580 million-asset Steuben Trust. The deal, which is expected to close in the second quarter, priced Steuben at 167% of its tangible book value.
Steuben Trust has 15 branches and $480 million in deposits.
The deal “will enhance and extend our banking footprint in western New York, in markets which we successfully compete in and aspire to continue to grow,” Mark Tryniski, Community Bank System’s president and CEO, said in the release. “Our move to establish a broader and deeper banking presence in this region is reflective of these growth objectives.”
Community Bank System said it expects the deal to be accretive to its earnings in the first year, excluding merger-related expenses. The deal should be immediately accretive to Community Bank System’s tangible book value.
Community Bank System expects to incur $6.5 million to $7.3 million in merger-related expenses. It plans to cut 30% of Steuben’s annual noninterest expense.
D.A. Davidson and Cadwalader, Wickersham & Taft advised Community Bank System. PNC FIG Advisory and Pillar Aught advised Steuben.
