Old National Bancorp Buys WFI Unit


Old National Insurance, which is a wholly owned subsidiary of Old National Bancorp. (ONB), acquired the insurance accounts serviced by the Evansville branch of Wells Fargo Insurance (:WFI) – a division of Wells Fargo & Company (WFC) – on Dec 1. The Evansville branch of WFI services mainly commercial property and casualty insurance accounts.

Though the financial terms of the deal were not disclosed, both WFI sales executives and the one account representative joined Old National Insurance team. Notably, the transaction will enable Old National Bancorp to utilize the expertise of WFI team.

Old National Insurance has been expanding over the past several months. In Sep 2013, the company announced a deal to acquire Tower Financial Corporation (TOFC) in a cash-cum-stock deal worth nearly $108 million. The transaction, still subject to approval from regulatory authorities and Tower Financial Corporation shareholders, is expected to close in the first quarter of 2014.

In July, Old National Bancorp completed the integration of 24 branches of Bank of America Corporation (BAC) located in Northern Indiana and Southwestern Michigan.

Apart from its inorganic growth strategy, Old National Bancorp has a steady share repurchase program in place. In the first nine months of 2013, the company repurchased shares worth $11.1 million. With total cash and cash equivalents of nearly $247.4 million as of Sep 30, 2013, the company is expected to further enhance shareholders’ value going forward.

Old National Bancorp’s consistent capital deployment activities make it an attractive option for yield-seeking investors. Further, we expect the company’s organic and inorganic growth strategies to increase top-line growth.

Currently, Old National Bancorp carries a Zacks Rank #3 (Hold).

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