Mount Hope Bankshares Acquisition
Allegheny Bancshares Inc. to acquire Mount Hope Bankshares, Inc. and its wholly-owned subsidiary, Bank of Mount Hope (Franklin, West Virginia and Mount Hope, West Virginia).
Allegheny Bancshares Inc. ("Allegheny") and Mount Hope Bankshares, Inc. ("Mount Hope") announced the signing of a definitive merger agreement between Allegheny and Mount Hope.
Pursuant to the terms of the merger agreement, Allegheny will acquire all of the outstanding shares of common stock of Mount Hope in exchange for cash in the amount of $58.00 per share. Total merger consideration received by Mount Hope shareholders is subject to an adjustment if Mount Hope's adjusted shareholders' equity as of the effective date of the merger is less than the target mutually determined by the parties. The aggregate consideration in the transaction is approximately $21.775 million.
The transaction has been unanimously approved by each company's board of directors and is expected to close in 2019, pending regulatory approvals and the approval of Mount Hope's shareholders. Following consummation of the merger, Mount Hope's wholly-owned subsidiary Bank of Mount Hope, Inc. will be consolidated with Allegheny's bank subsidiary, Pendleton Community Bank, Inc.
Allegheny's President and Chief Executive Officer, William A. Loving, Jr., said "We are excited with the opportunity to join our company with The Bank of Mount Hope whose culture and strong performance will only further strengthen our company, expand our footprint and provide more banking options for customers of Pendleton Community Bank and Bank of Mount Hope. Banking is a people business….a business of relationships. We look forward to working with Mount Hope's management and staff to build upon the relationships we have individually created; and, collectively, building into the communities we serve. We look forward to welcoming Mount Hope's customers as we work toward a seamless transition."
Mount Hope's President and Chief Executive officer, Ben M. Susman, said "This merger will provide resources to allow for continued growth in the marketplace. It is a win-win for our shareholders and our customers. This merger will provide our customers with enhanced banking products and services while maintaining a community banking option. We were impressed with the leadership and vision of Pendleton. This transaction will be good for Raleigh and Fayette Counties."
Mount Hope was advised by the investment banking firm of ProBank Austin and the law firm Bowles Rice LLP. Allegheny was advised by the investment banking firm of Vining Sparks Community Bank Advisory Group and was represented by the law firm Jackson Kelly PLLC.
Allegheny is a $320 million bank holding company headquartered in Franklin, West Virginia. Pendleton Community Bank, Inc., an independent community bank since 1925, currently has four full-service financial centers located in the West Virginia communities of Franklin, Moorefield, Marlinton, Petersburg, and two financial centers and mortgage division in the Virginia community of Harrisonburg. In addition, the Bank has a loan production office in Wardensville, West Virginia.
About Mount Hope
Mount Hope, a bank holding company headquartered in Mount Hope, West Virginia, reported approximately $124 million in assets as of March 31, 2019, and operates three community banking offices in Mount Hope, Beckley and Oak Hill, West Virginia, through its subsidiary, Bank of Mount Hope, Inc.
With respect to Allegheny:
William A. Loving, Jr., President & CEO
Telephone: (304) 358-2311
With respect to Mount Hope:
Ben M. Susman, President & CEO
Telephone: (304) 877-5551
This press release includes forward-looking statements, which are not historical facts and pertain to future operating results. These forward-looking statements are intended to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. These statements are subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond our control. Accordingly, actual results may differ materially from anticipated results.
Allegheny Bancshares Inc. announces 2019 earnings
Allegheny Bancshares, Inc., the parent company of Pendleton Community Bank, is pleased to announce second quarter 2019 net income of $821,000 or $0.98 per share. In comparison, net income for second quarter 2018 was $1,002,000 or $1.20 per share.
For the first half of 2019, Allegheny had net income of $1,679,000 or $2.01 per share, which is a decrease in net income from $1,941,000 earned in the first half of 2018. Return on Average Assets (ROAA) for the first 6 months was 1.08% and the Return on Average Equity (ROAE) was 8.73%. This compares to a ROAA of 1.33% and a ROAE of 10.58% for the same period of 2018.
Assets increased by 6.0% from June 30, 2018 to June 30, 2019 and, at the end of the quarter totaled $317 million. At June 30, 2019, total loans were $252.5 million, an increase of $15.8 million, or 6.7% from June 30, 2018 while deposits grew $15.5 million, or 6.1% for the same period. Shareholders' Equity at the end of the quarter totaled $40.1 million.
The decrease in net income for the first half of 2019 compared to the same period in 2018 was attributed to increases in the provision for loan loss expense and non-interest expenses including preparation costs for Allegheny's planned merger with Bank of Mount Hope. These additional expenses more than offset the 4.8% ($292,000) increase in net interest income, and a 7.7% ($83,000) increase in non-interest income.
W.A. (Bill) Loving, President and CEO, indicated he was pleased with the second quarter and first six months' performance. According to Loving, "2019 is a transitional year for Allegheny Bancshares. With the planned expansion of our Wardensville Loan Production Office to a full service financial center, to be soon followed by our merger with Bank of Mount Hope (which will add another three full service financial centers), we have focused on preparing for growth and a smooth consolidation of customers. In addition, we continued to invest in talent and resources in our current footprint. These steps toward the future, along with the increased loan loss provision allocated to support the growth in loans, increased non-interest expenses at a greater pace than the increased interest and non-interest income. We are excited about the prospects these investments will make for the future and I am especially optimistic as I look to what our larger financial center network can do to increase shareholder value in Allegheny Bancshares and future opportunities that will become available to us."
This press release includes forward-looking statements, which are not historical facts and pertain to future operating results. These forward-looking statements are intended to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond our control. Accordingly, actual results may differ materially from anticipated results.
Pendleton Community Bank, an independent community bank since 1925, currently has four full-service financial centers located in the West Virginia communities of Franklin, Moorefield, Marlinton, Petersburg, and two offices in the Virginia community of Harrisonburg; a loan production office in Wardensville, West Virginia; and a mortgage division that is headquartered in Harrisonburg, VA