ESSA Bancorp (ESSA) in Stroudsburg, Pa., has agreed to buy Franklin Security Bancorp in nearby Wilkes-Barre.
The $1.4 billion-asset ESSA would pay approximately $15.7 million in cash for Franklin, the companies said Monday. Franklin stockholders would receive $9.75 per share in the deal, which is expected to close in the second quarter.
ESSA would gain Franklin's two Pennsylvania branches, $223 million of assets, $149 million of loans and $168 million of deposits. The president and chief executive of Franklin's bank unit, Richard Mebane, will join ESSA Bank & Trust as market president.
Franklin "provides a platform for ESSA to expand its presence northward to an adjacent regional market," ESSA's president and CEO, Gary Olson, said in the release. Its "strong commercial banking and indirect-auto-lending businesses will provide added diversification to ESSA's balance sheet and complement ESSA's existing capabilities in retail and commercial banking."
The combined company also will expand ESSA's consumer and mortgage businesses into Franklin's current market, Olson said.
RP Financial served as financial advisor to ESSA and Luse Gorman Pomerenk & Schick served as legal counsel. Franklin was advised by Ambassador Financial Group and Boenning & Scattergood. Elias, Matz, Tiernan & Herrick acted as legal counsel to Franklin.
In August, ESSA agreed to acquire First National Community Bancorp's (FNCB) Monroe County branch along with an unspecified amount of deposits and loans. First National is based in Dunmore, Pa.