Premier Financial Bancorp Inc. in Huntington, W.Va., is planning to consolidate three of its four subsidiary banks as part of its ongoing effort to build scale, lower its compliance costs and improve its overall efficiency.

The $1.1 billion-asset company said Thursday that it is combining its two Kentucky banks, Citizens Deposit Bank and Trust in Vanceburg and Farmers Deposit Bank in Eminence, with its one Ohio bank, Ohio River Bank in Ironton, into a single bank with $367 million of assets and 13 branches.

The charter consolidation would be a continuation of a process Premier started early last year when it combined five of its subsidiary banks in West Virginia, Virginia and Washington, D.C., into what is now the $733 million-asset Premier Bank. That bank would retain its name and West Virginia charter.

Under the latest consolidation, Farmers Deposit Bank and Ohio River Bank would be merged into Citizens Deposit Bank and Trust, which would operate as a Kentucky-chartered commercial bank.

In a news release Thursday, Premier said that merger would strengthen Citizens Deposit's capital ratios and increase its lending capacity.

"We are proud of the network of community bank franchises that we have built," Premier's president and chief executive, Robert W. Walker, said in a news release. "But in the current economic and banking environment, size and resources matter. By combining these three franchises into one, we believe our customers will benefit from the greater network of locations and the increase in the lending limit of the combined bank."

Walker said shareholders would benefit, too, "as we rely less on expensive external consultants to help us with ongoing regulatory changes and use our existing employee talent base more effectively."

Premier said it has filed all the necessary applications with regulators, but did not disclose when it expects the transaction to close or what the impact would be on earnings. At midday Thursday Premier's shares were trading at $5.89, down 3.4% from Wednesday's close.

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