In North Dakota, Merchants Bank agreed to purchase three Western State Bank branches.
Devils Lake-based Western State and Rugby-based Merchants are the respective subsidiaries of Western State Agency Inc. and Sioux Falls, S.D.-based Merchants Holding Co. As of Sept. 30, Western State Bank had $1.02 billion in assets; Merchants Bank had $108.7 million.
Merchants will pay a premium for the deposits and buy for fair value the banking assets and certain loans associated with the branches in Towner, Upham and Granville in McHenry County. There are no plans to shutter sites or discontinue any services, according to a regulatory filing recently acquired by S&P Global Market Intelligence.
Merchants hopes to close the transaction on Dec. 31, pending regulatory approvals. Until those approvals are received, it may provide Western State with management assistance, as the branches' market president has already departed.
Merchants Bank will receive an equity injection from its parent company to stay "well-capitalized" after the deal.
