Hibernia Corp. has announced a deal that would mark its return to Texas after a four-year absence, but officials said the agreement to acquire a Texarkana bank does not presage a major buildup in the Lone Star State.
"It's not Texas we're going after," said spokesman Jim Lestelle. "It's just that market in Texarkana."
Hibernia, which is based in New Orleans, said Wednesday it had agreed to acquire Texarkana National Bancshares for $77 million in stock, or 1.9 times book value. Texarkana National, with $406 million of assets and nine branches, controls a leading 47% of the deposits in Bowie County.
Texarkana is located at the intersection of the Texas and Arkansas borders 75 miles north of Shreveport, La.
"We view the move into Texarkana as a natural and logical extension of our strong presence in the Shreveport market in northwest Louisiana," said Stephen A. Hansel, Hibernia's president and chief executive.
Hibernia currently conducts small-business lending in northeast Texas from its Shreveport bank, which will manage Texarkana National when the transaction closes at yearend.
Hibernia had previously operated a sizable bank in Texas, which it built up to $1.3 billion of assets through numerous acquisitions during the 1980s. But in 1992, with the company's New Orleans flagship hovering on the brink of failure, the Texas unit was sold to Detroit-based Comerica Inc. in order to raise capital.
Hibernia executives regret that sale, because the unit was profitable and heavily concentrated in the fast-growing Dallas area.
Texarkana National is also profitable, returning 1.56% on assets and 17.5% on equity in the first quarter. Mr. Lestelle said Hibernia expects the acquisition to be accretive to its 1997 earnings based on a 15% reduction in Texarkana National's annual expense base.
Hibernia currently has $7.5 billion of assets, but pending acquisitions, including Texarkana National, would increase that to $8.9 billion.