First Financial Bankshares FFIN announced that it has completed the acquisition of Commercial Bancshares along with its wholly-owned subsidiary, Commercial State Bank, with effect from Jan 1, 2018. The deal was announced in October 2017.
Based in Abilene, TX, First Financial now has operations in high growth area around Houston — in about 73 locations that extends from Hereford in the Panhandle to Orange in southeast Texas.
CEO of First Financial, F. Scott Dueser, said "We are most impressed with the employees, officers, management and board of this quality bank, who share our same values, philosophies and commitment to outstanding customer service. They are an excellent addition to our footprint especially in the high growth area around Houston."
Terms of the Deal
First Financial issued 1,289,371 shares of its common stock to shareholders of Commercial Bancshares valuing about $59.4 million.
Also, during the pre-closing period, Commercial Bancshares paid special dividends totaling $22.3 million, above its expectations of $15.6 million disclosed in October.
Commercial State Bank had total assets of nearly $390.2 million, total loans of about $271.5 million and total deposits of approximately $345.9 million, as of Dec 31, 2017. Addition of these to First Financial’s balance sheet will bolster its financial position.
First Financial’s strong balance sheet position supports its involvement in such strategic acquisitions. In addition to helping the company in strengthening its footprint outside Houston, the deal will diversify its sources of revenues.
Also, with the improving domestic economy and lower taxes, First Financial’s financial is expected to witness a steady improvement in profitability.
Shares of First Financial have gained slightly over the past three months, underperforming 2.7% growth for the industry it belongs to.
Currently, the stock carries a Zacks Rank #3 (Hold).
Stocks to Consider
Texas Capital Bancshares’ TCBI Zacks Consensus Estimate for earnings for 2017 was revised slightly upward, in the last 60 days. Also, its share price has increased 13.2% in the past 12 months. The stock sports a Zacks Rank #1 (Strong Buy) You can see the complete list of today’s Zacks #1 Rank stocks here.
Cullen/Frost Bankers CFR currently carries a Zacks Rank #2 (Buy). The stock’s 2017 earnings estimates were revised slightly upward, in the last 60 days. Further, the company’s shares have gained 8% in a year’s time.
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Texas Capital Bancshares, Inc. (TCBI) : Free Stock Analysis Report
Banc of California, Inc. (BANC) : Free Stock Analysis Report
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First Financial Bankshares, Inc. (FFIN) : Free Stock Analysis Report
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