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Prospect Federal Savings Bank to merge into Hoyne Savings Bank

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Prospect Federal Savings Bank to merge into Hoyne Savings Bank

Chicago-based HoyneSavings Bank ($269.2 million) and Worth, Ill.-based ($240.8 million)have agreed to merge,with the former continuing as the surviving institution and retaining its mutualholding company form of ownership.

Hoyne is a unit of HoyneFinancial Corp, which in turn is wholly owned by Hoyne Savings MHC.

Deal terms were not disclosed, but SNL data shows that offerfor bank and thrift targets in the Midwest between Sept. 30, 2015, and Sept. 30,2016, averaged 131.94% of book value, 135.55% of tangible book and had a medianof 18.24x last-12-month earnings, on an aggregate basis.

The merger requires regulatory approval as well as the approvalof Prospect and Hoyne Savings MHC members. Deal completion is expected to occuras early as the first quarter of 2017 and will result in a combined savings bankwith assets of about $500 million, $86 million in equity and a network of eightbranches throughout the Chicagoland area. Seven of those branches will operate inCook County, ranking the combined entity No. 38 in the area, with a 0.15% shareof approximately $282.62 billion in total market deposits. The eighth branch willbe in Mchenry County, ranked No. 25 with a 0.20% share of approximately $6.02 billionin total market deposits.

Following the merger, Hoyne President and CEO Ralph Carstensenwill serve as CEO and Prospect President and CEO Steven Rosenbaum will serve aspresident and COO of Hoyne, Hoyne Financial and Hoyne Savings MHC.

Five current Hoyne directors and four current Prospect directorswill be on the boards of the continuing entities.

The law firm of Silver Freedman Taff & Tiernan LLP actedas legal counsel for Hoyne Savings Bank, while the law firm of Vedder Price PC actedas legal counsel for Prospect Federal Savings Bank. RP Financial LC provided financialadvisory services for the transaction.

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