Eagle Bancorp Inc. in Bethesda, Md., has announced plans to buy hometown rival Fidelity and Trust Corp. for $48.8 million of stock.
The deal, announced late Sunday, would be the first ever for the nine-year-old Eagle and would create a $1.3 billion-asset banking company with roughly a dozen branches in the Washington area.
Fidelity's banking subsidiary, the four-year-old Fidelity Bank and Trust, is to be merged into Eagle's banking unit, the $802 million-asset EagleBank.
The company's executives know each other well. EagleBank chairman, president, and chief executive officer Ronald Paul said that Fidelity chairman Robert Pincus gave him his first commercial real estate loan 25 years ago. Mr. Pincus is to become EagleBank's vice chairman.
Fidelity is privately held. Under terms of the deal, its shareholders would get slightly less than one share of Eagle stock for each share owned. Two members of Fidelity's board would join the board of Eagle Bancorp, and four of its board members would join EagleBank.
In late trading Monday, Eagle's shares were up 5.7% from Friday's close, at $13.22.
