Guaranty Bancorp in Denver has agreed to buy Castle Rock Bank Holding Co. in Colorado.
The $3.4 billion-asset Guaranty said in a press release late Wednesday that it will pay $23 million in stock for the $148 million-asset Castle Rock. The deal, which is expected to close in the first quarter, prices Castle Rock at 145% of its tangible book value.
Castle Rock has two branches between Denver and Colorado Springs, along with $131 million in deposits and $77 million in loans.
Guaranty said it expects the deal to be 2.5% accretive to its 2018 earnings per share. It should immediately increase Guaranty’s tangible book value.
“We are pleased to welcome a high quality franchise like Castle Rock Bank with their solid core deposit base and excess liquidity,” Paul Taylor, Guaranty’s president and CEO, said in the release. “This acquisition provides a fill-in opportunity … and strengthens our position as one of the premier community banks headquartered in Colorado.”
Guaranty said it plans to cut about 60% of Castle Rock’s annual noninterest expenses. The company expects to incur about $3 million of merger-related expenses.