QNB to acquire smaller rival in southeastern Pennsylvania

• Key Insight: A bank in Pennsylvania has agreed to buy an in-state rival.  
• Supporting Data: The combined entity would exceed $2 billion of assets.
• Forward Look: The banks say the deal could close within the next couple of months.

QNB Corp. in Quakertown, Pennsylvania, plans to acquire a neighboring bank in an all-stock deal that could close as soon as the fourth quarter, the companies said Tuesday afternoon.
QNB will pay roughly $41 million to purchase The Victory Bancorp in Limerick, Pennsylvania, located approximately 40 miles south of Quakertown, it said in a press release. If the transaction is approved by regulators and shareholders, it will create a $2.4 billion-asset bank with nine locations in southeastern Pennsylvania, all of which will operate under the QNB Bank brand.

QNB has about $1.9 billion of assets. The Victory Bancorp has about $477 million of assets. The combined company will be headquartered in Quakertown, the release said.

David Freeman, QNB's president and CEO since 2013, will continue in those roles after the deal closes. Joseph Major, president and CEO of Victory, will join the QNB board of directors as vice chair. QNB's board will expand from 10 directors to 12, and will include Major and one more director from Victory's board who was not identified in Tuesday's press release. Randy Bimes, who has served as chair of QNB since 2024, will continue to serve as chair of the expanded board.

"This merger marks an important step forward in further building out a leading Pennsylvania franchise that enhances our ability to serve communities, enrich the local banking experience, and deliver outstanding services to our customers," Freeman said in the release. "The combination will result in a strong well-diversified bank, positioning us to accelerate growth."

Under the terms of the agreement, Victory shareholders will receive 0.55 shares of QNB common stock for each share of Victory common stock they own, the banks said. The combined post-merger shareholder ownership split would be about 76.4% for QNB and 23.6% for Victory.

Prior to the closing of the deal, Major and Robert Schultz, Victory's chief financial officer, will enter into consulting agreements with QNB, according to a regulatory filing Tuesday.

"Given the familiarity between our institutions, boards, and management teams, we are confident that our combined teams will harness the strengths of both banks in an effort to deliver lasting value for our customers, shareholders, communities, and employees," Major said in the release. "We look forward to building upon our well-recognized position in Montgomery County."

If the deal closes in the fourth quarter, it would be yet another example of the faster bank merger approval timelines under the Trump administration, which has pressed for both deregulation and fewer roadblocks to M&A. The banks noted that the tie-up could also close in the first quarter of 2026.

QNB was founded in 1877 as the Quakertown National Bank and changed its name in 2007, according to the Federal Deposit Insurance Corp. The bank's website shows just two prior acquisitions, one in 1993 and one in 1997, both of which were single-branch acquisitions.

The Victory Bank was founded in 2008 and has three branches, according to the FDIC.

Performance Trust Capital Partners served as financial advisor to QNB, while Stevens & Lee was its legal counsel, according to the press release. The Kafafian Group was the financial advisor to Victory, while Kilpatrick Townsend & Stockton served as legal counsel.