Jeff Davis Bancshares of Jennings, La., has agreed to acquire Guaranty Capital, as the buyer expands northward in its home state.
Jeff Davis operates 14 branches in southwestern Louisiana, while Mamou-based Guaranty Capital has four branches of its Guaranty Bank unit, northeast of Jeff Davis' retail footprint. Jeff Davis plans to keep all four Guaranty branches, said Boyd Boudreaux, president and chief executive.
The companies signed the agreement Friday. The all-cash deal requires approval from Guaranty's shareholders and from regulators. Boudreaux expects the deal to close by the end of the year. Terms were not disclosed.
Jeff Davis' board last year determined that it "needed a little more scale to absorb all the regulatory costs coming down the pike," Boudreaux said. With the acquisition, Jeff Davis' total assets would increase to about $706 million.
Both companies are well-capitalized; Jeff Davis posted a Tier 1 risk-based capital ratio of 16.7% as of June 30, and Guaranty's Tier 1 ratio was 21.6%.
