Gateway Mortgage's owners are acquiring the majority interest in Farmers Exchange Bank and will merge the lender into the Cherokee, Okla., depository.
The Stitt Family Trusts, which collectively own all the shares of Gateway Mortgage, are buying an 85% stake in Farmers Exchange, which has five branches in Oklahoma. The bank has $321 million in assets and $274 million in deposits, according to its most recent call report with the Federal Deposit Insurance Corp.
Gateway did not disclose the price that the trusts will pay.
Merging Gateway into Farmers Exchange will support the long-term growth of both institutions, as well as diversify the financial services offered, a press release said.
"We believe this acquisition is an important next step for Gateway that will allow for growth, providing greater opportunity for employees and the communities they serve," Stephen Curry, the Tulsa, Okla., lender's newly appointed CEO, said in the release.
"Through this acquisition, both Farmers Exchange and Gateway can expect to gain improved products and technology that will enhance their ability to strengthen the families in their communities. We're excited about this new venture and the benefits it will provide to our customers," Curry added.
Curry succeeded Kevin Stitt as Gateway's CEO on Aug. 1. Curry, who was an adviser to Gateway for the past year, was the founder of Everett Advisory Partners, a banking advisory firm based in Tulsa. From 2002 to 2008, he was a managing director at Bank of America and, before that, chief operating officer of corporate and investment banking at NationsBank.
Gateway originated $3.1 billion in mortgage loans in the first half of this year. It has a $17 billion servicing portfolio. Farmers Exchange doesn't have much of a mortgage presence, with a portfolio of only $40 million.
"Gateway has always maintained a strategic eye on growth in Oklahoma, and we are proud of the great culture and workplace that we've been known and recognized for," said Stitt, who is Gateway's chairman and will become nonexecutive chairman of Farmers Exchange when the merger is completed.
After the deal closes, former FDIC Chairman Donald Powell will join the newly merged company's board.