Two Michigan community banks plan to merge in a $174 million deal that would create the state's fourth-largest bank holding company, with 120 branches and assets of $3 billion.

Chemical Financial Corp. in Midland and Shoreline Financial Corp. in Benton Harbor have structured the deal as a tax-free exchange of shares. Shoreline investors would receive 0.64 shares of Chemical stock for each of their Shoreline shares. "For our shareholders, this affiliation will provide ownership in a growing organization with a 25-year history of consecutive increases in both annual per-share earnings and dividends," said Dan L. Smith, Shoreline Financial Corp.'s chairman and chief executive officer.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.