First Farmers Bank & Trust in Converse, Ind., has received regulatory approval to acquire most of the Bank of Indiana.

The Federal Reserve on Friday said the $1.1 billion-asset First Farmers may buy all of Bank of Indiana's $14.8 million in deposits as well as its four branches. First Farmers will also buy most of the assets of Bank of Indiana, which is in Dana. The deal will make First Farmers the 23rd-largest bank in Indiana, with approximately $861 million in deposits.

The $90 million-asset Bank of Indiana is currently operating under a 2009 formal agreement with the Office of the Comptroller of the Currency for issues related to its credit administration. Its holding company, Indiana Bank Corp., has filed for Chapter 11 bankruptcy.

Federal regulators note that First Farmers' management team proved its ability to manage acquisitions with problem assets when it bought First Citizens of Paris in 2012. First Farmers paid roughly $17 million for the Paris, Ill., bank.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.