River Valley to Buy a Fellow Indiana Bank, Switch Charters

River Valley Bancorp in Madison, Ind., has agreed to acquire Dupont State Bank.

Dupont is a commercial bank owned by Citizens Union Bancorp of Shelbyville, in Kentucky.

Under the deal excepted to close in the second quarter, River Valley would pay $6.3 million in cash for all the common stock of the $82 million-asset Dupont, according to a press release on Monday. The $402 million-asset River Valley also would convert from a federally chartered thrift to a state-chartered bank and rename itself River Valley Financial Bank.

The combined company would have $322 million of loans and $373 million of deposits. River Valley's branch network would expand to include North Vernon, Seymour and Dupont, Ind. River Valley said that deal should be accretive to its earnings next year and accretive to tangible book value in 2013.

Jeff Rayburn, Citizens chief executive and senior lender, would remain after the merger as a senior vice president.

"This combination provides our customers a larger branch network to effectively and efficiently conduct their business in southern Indiana," Rayburn said. "River Valley is a well-capitalized institution that provides us a strong base for future lending."

River Valley can terminate the deal for several reasons, including if Dupont's closing book value is less than $7.3 million, if its real estate owned exceeds $2 million at closing or delinquent loans exceed 4% at closing.

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