Lafayette-based IberiaBank will be bought by First Horizon National Corporation, of Memphis, the companies announced this morning, in a deal that’s set to be the second-largest bank merger of the year.
Through the deal, the companies will combine in an “all-stock merger of equals,” with the combined entity operating under the First Horizon name and being headquartered in Memphis. The company’s regional banking headquarters will be located in New Orleans. Combined, the company will have an 11-state reach.
IberiaBank President Daryl Byrd says in a prepared statement the merger gives the company the resources to invest in advanced technologies while expanding its lending capacity and product offerings.
Per the agreement, First Horizon shareholders will own 56% of the combined company, while IberiaBank shareholders will own 44%. IberiaBank shareholders will receive 4.584 shares of First Horizon for each IberiaBank share they own, and will receive a 43% increase in their dividend after the transaction is complete, based on each company’s current dividend per share.
The organization’s board and executive leadership team will be comprised of members from both banking entities. The new company will be led by Byrd as executive chairman of the board of directors and D. Bryan Jordan, chairman and CEO of First Horizon, as CEO. The board will consist of nine directors from First Horizon and eight from IberiaBank.
The merger is expected to close in the second quarter of 2020, dependent on customary closing conditions, including regulatory approval and approval by shareholders of each company.
According to the most recent data from the Federal Deposit Insurance Corp., Iberia is the fifth-largest bank in the Baton Rouge market, with 4.4% of the local market share and $903 million in local deposits. Once the merger is complete, the combined organization will hold $75 million in assets, $57 billion in deposits and $55 billion in loans, making the company one of the largest financial institutions in the South and, by deposits, one of the top 25 banks in the nation.
IberiaBank has grown from a small community bank to the largest one headquartered in Louisiana, although it moved to shrink its retail footprint last year, closing or consolidating seven of its Louisiana branches—including one in Baton Rouge—as part of a long-term strategy to improve efficiency as it focuses on digital banking.
Read a recent Business Report feature on the consolidations in the local banking industry.
