Financially troubled Premier Bank announced today that it is selling its three banking centers in Columbia to First State Community Bank of Farmington, Missouri.
After extraordinary loan losses in real estate, Premier Bank’s holding company was placed under the supervision of the Federal Reserve one year ago. Columbia market President Steve Smith resigned in September.
Premier Bank, which is based in Jefferson City, also has operations in St. Louis, Lake of the Ozarks and Texas.
Chairman and CEO Bruce Wiley said in a news release that he believes the sale “the right decision for our customers, employees and shareholders.”
Premier said the majority of its Columbia employees will keep their jobs when FSCB takes over.
“Premier sustained heavy losses in 2008 and 2009 due to our problem real estate portfolio,” Wiley said. “FSCB is an excellent bank to assume our quality assets and substantial deposit relationships while providing excellent jobs and benefits to the Columbia employees that have been so important to Premier’s growth.” .
Both asset reduction as well as FSCB paying a premium for deposits will strengthen Premier’s capital position, Premier said in its news release.
The acquisition of the Premier Bank locations will increase FSCB’s branch network to 32 locations in 24 communities. FSCB also recently completed an acquisition of two Truman Bank locations in northern Jefferson County. FSCB has banking locations from Warrenton in the north to Hayti in the south, and many points between. Compared to the 40 largest banks in Missouri, whose non-performing loans equaled 3.18 percent of total loans at the end of 2009, FSCB maintained a ratio of only 0.27 percent at year end. In addition, the bank’s net income exceeded $9.8 million in 2009.
“The Premier Bank locations will be a great addition to the First State Community Bank Family,” FSCB Chairman Bill Cooper said. “We are grateful for this opportunity and look forward to serving the thriving Columbia community.”
The agreement has been approved by both Premier Bank’s and FSCB’s board of directors and is subject to customary regulatory approvals. The purchase is expected to close in early July.
Premier Bank will continue its normal operations in Missouri and Texas. As of December 31, 2009, Premier Bank had over 230 employees and $1.27 billion in total assets.