ConnectOne bolsters New York operations with Greater Hudson deal

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ConnectOne Bancorp in Englewood Cliffs, N.J., has agreed to buy Greater Hudson Bank in Bardonia, N.Y.

The $5.2 billion-asset ConnectOne said in a press release Thursday that it will pay $76.3 million in stock for the $501 million-asset Greater Hudson. The deal, which is expected to close in the first quarter, priced Greater Hudson at 134% of its tangible book value.

“This transaction reflects a financially attractive, compelling expansion opportunity to combine with a similarly-minded, commercially-focused lender operating within the 75-mile radius of [New York City] where ConnectOne has excelled,” Frank Sorrentino, ConnectOne’s chairman and CEO, said in the release.

The acquisition “also strongly supports our stated growth strategy, which includes opportunistic growth through M&A, to enhance our desirable and valuable franchise,” Sorrentino added.

Greater Hudson’s loan-to-deposit ratio was 85% on March 31. The bank has $402 million in deposits and $341 million in loans. ConnectOne will also gain a Small Business Administration platform from the acquisition.

The deal should be 2.5% accretive to ConnectOne’s earnings per share in 2020, excluding revenue opportunities. It should take two years for ConnectOne to earn back the projected 1% dilution to its tangible book value.

ConnectOne said it expects to incur $7 million of merger-related expenses. It plans to cut about 40% of Greater Hudson’s annual noninterest expense.

One of Greater Hudson’s directors will join ConnectOne’s board.

Piper Jaffray and Windels Marx Lane & Mittendorf advised ConnectOne. Keefe, Bruyette & Woods and Hogan Lovells advised Greater Hudson.

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