It’s also another sign that bank failures, many the result of problem loans during the housing boom-turned-bust, are on the decline. The number of failed banks has declined from 23 in 2011 to 10 in 2012 and three so far this year, according to the Federal Deposit Insurance Corp.
“There are still some troubled banks,” said Oliver, whose bank has grown partly through the acquisition of such banks. “We just didn’t see that many.”
Hamilton State’s most recent acquisitions have included four failed banks: Bartow County Bank in Cartersville; McIntosh State Bank in Jackson; First State Bank in Stockbridge; and Douglas County Bank in Douglasville, which Hamilton State acquired this year.
Cherokee Bank, founded in 1999, operates three branches in Cherokee County - two in Canton and one in Woodstock. It has total assets of about $168 million and about $150 million in deposits.
Hamilton State, based in Hoschton, has about $1.4 billion in total assets, $1.2 billion in deposits and $218 million in total capital, the company said.
The Cherokee branches will operate under the Hamilton State Bank brand. After the deal, which is expected to close in the first quarter of 2014, Hamilton State will have 27 branches in North Georgia.
“We are trying to build a very quality franchise around the metro Atlanta market,” Oliver said.
Hamilton State will pay $4 a share in cash for Cherokee’s 2,131,639 shares of outstanding common stock. Oliver said the deal also includes other financial considerations.
The CEO said Hamilton State will continue to use $230 million it raised in 2011 for acquisitions to pursue future deals. The banking company has also considered deals in adjoining states.
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