Community bank merger activity heated up in the South last week with proposed transactions that would give Georgia and Arkansas new billion- dollar-asset institutions.

Century South Banks, Gainesville, Ga., has agreed to buy Macon-based Bank Corporation of Georgia in a stock deal valued at about $60 million. The combined company would top $1 billion of assets and have 34 branches from Copperhill, Tenn., to Savannah, Ga.

To the west, Simmons First National Corp. announced it would pay $53 million in cash for two banks, First Bank of Arkansas, Searcy, and First Bank of Arkansas, Russellville. After the deal closes, Pine Bluff, Ark.- based Simmons First would own seven banks with 39 branches in the state.

The announcements came as analysts see a pickup in merger activity in southeastern states like North Carolina, South Carolina, Florida, and Georgia. "Most definitely, the number of transactions (is) increasing," said Steven W. Carson, president of the Carson Medlin Co., an investment banking firm in Tampa that specializes in banks and thrifts of the Southeast.

Georgia is bracing for mergers and acquisitions now that a new branching law lets banks cross county lines without buying another bank. Bankers say that's prompted them to look into other markets and, as they do, to consider more seriously merging with each other.

Already, more in-state acquisitions are occurring in Georgia, said Kathryn Bissette, a bank analyst at Sterne, Agee & Leach in Atlanta. The activity started in January with the announcement that Premier Bankshares in Atlanta planned to acquire Central & Southern Holding Co., Milledgeville, in a $50 million deal. The merger is to create a $500 million-asset institution.

Although the agreement is only a week old, Century South's deal for Bank Corporation of Georgia had been a long time in the making.

Joe Evans, president and chief executive officer of Bank Corporation, said a 20-year friendship with Jimmy Faulkner, president and chief executive officer of Century South, had led to the planned merger.

Mr. Evans said Mr. Faulkner sat on Bank Corporation's board for several years and the two developed a "pretty deep understanding" of each other's banks.

"The resulting company, we think, is going to be very attractive in terms of franchise and just being in a good position to be able to do a lot of exciting things in Georgia," Ms. Bissette said. "They'll be over a billion in assets. That size level of a banking company has true scarcity value in Georgia."

Meanwhile, Simmons First's acquisition of two banks could signal an awakening in the Arkansas market, which hasn't been as active as those of its southern neighbors.

The Simmons First deal is actually the consequence of another Arkansas bank merger. First Commercial Corp., a $6.5 billion-asset bank in Little Rock, is buying Southwest Bancshares, an $830 million-asset holding company based in Jonesboro.

As part of the transaction, First Commercial had to divest Southwest's Searcy and Russellville banks because the larger company already controlled the market share in those areas.

"Everybody is trying to maximize profitability," said Frank W. Anderson, a bank analyst at Stephens Inc., Dallas.

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