National Penn Bancshares Inc. has a deal that would expand the Boyerstown company in two of Pennsylvania's most affluent counties.
The $2.8 billion-asset holding company for National Penn Bank announced the deal Tuesday, saying it had agreed to pay $93.5 million for $400 million-asset FirstService Bank of Doylestown.
John C. Spier, the president and chief executive of FirstService, said that Bucks and Montgomery counties rank among the richest counties in the state. FirstService has six branches in Bucks and two in Montgomery.
"They are well diversified, with a lot of wealth," Mr. Spier said. "We fill them in for National Penn."
The cash-and-stock transaction is expected to close in the first quarter, and National Penn said the deal should be accretive to earnings in its second year.
The suburban Philadelphia counties have a combined population of 1.4 million and boast a median household income of about $60,000, 52% above the state median, according to 2001 statistics compiled by the Census Bureau. More than 43,000 businesses are headquartered there.
FirstService would retain its name as a division of National Penn Bank, which plans to convert three of National Penn's four Bucks County offices to the FirstService brand.
Gary L. Rhoads, National Penn's group executive vice president and chief financial officer, said that converting the branches would give it the best chance for success. FirstService "has developed a reputation there that is stronger than our own," he said.
According to data from the Federal Deposit Insurance Corp., buying FirstService would give National Penn a 3% share of the counties' $21 billion deposit market and make it the No. 9 banking company there. It would have 14 branches in Montgomery and 10 in Bucks.
FirstService has focused mainly on serving small business since opening in 1995. Mr. Spier said that the merger would give it the opportunity to "pump more products" into its mix, particularly retail offerings such as online banking and mortgages.
Mr. Spier is to be CEO of the FirstService division and become a National Penn group vice president with responsibility for corporate planning.
