FNB United Corp. has completed its acquisition of Bank of Granite Corp., part of the unprecedented merger of two ailing banks in North Carolina.

FNB in Asheboro, N.C., announced this year that it would merge Bank of Granite with its banking unit, fueled by the $310 million recapitalization led by The Carlyle Group and Oak Hill Capital Partners. FNB United said Monday that the capital raise has been completed, too, and that it would consolidate the two banks under one name, CommunityONE Bank, in late spring, subject to regulatory approval. In the meantime, the banks will operate separately.

The transaction was the first open-bank deal combining two struggling banks with private equity, rather than having a healthy buyer. Bank of Granite was under-capitalized with a total risk-based capital ratio of 5.10% at June 30. And the existing CommunityONE Bank had a negative 6.15% ratio at June 30.

"This is truly an unprecedented historic event for community banking in North Carolina," said FNB United's new chief executive, Brian Simpson, in a news release. "We have successfully raised sufficient capital to restore two 100-year-old banking companies simultaneously. By combining them under one organization we have the opportunity to again be an economic driver in the communities we serve."

The new CommunityONE will have $2.8 billion of assets and 63 branches.

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