Peoples Bank Acquires IL-Based First Personal Bank

Peoples Bank Acquires IL-Based First Personal Bank

NorthWest Indiana Bancorp (OTCBB: NWIN), the parent of Peoples Bank SB, and First Personal Financial Corp. announced they have executed a definitive agreement whereby NWIN will acquire First Personal and its wholly-owned subsidiary, First Personal Bank, of Orland Park, IL, in a stock and cash transaction.

Under the terms of the merger agreement, shareholders of First Personal will receive 0.1246 shares of NWIN’s common stock and $6.67 in cash for each issued and outstanding share of First Personal common stock, for total consideration that consists of 44% stock and 56% cash. Based on NWIN’s closing stock price of $42.80 as of February 20, 2018, the merger consideration has an aggregate value of approximately $15.60 million, which represents approximately 134% of tangible book value, and includes the impact of the conversion of all outstanding convertible capital instruments into common equity, which is expected to occur prior to closing.

First Personal is a bank holding company headquartered in Orland Park, Illinois with total assets of $147 million. First Personal Bank was established in 1999 and serves the Chicagoland metropolitan market with three full service locations.

“As we welcome First Personal’s customers and employees to Peoples Bank, we achieve a strategic goal of competing in the I-80 economic corridor stretching from Northwest Indiana across the state line into south suburban Chicagoland. This acquisition is a natural fit with strong benefits expected to accrue to our shareholders upon the close and integration of the merger,” said Benjamin J. Bochnowski, president and chief executive officer.

“First Personal was founded on similar values by its chief executive officer, Randy Schwartz, and these shared values are what make this merger a great fit. Randy was able to build a strong foundation, and together, our combined resources will be able to serve our customers better than ever before,” continued Bochnowski. “I’m happy to say that post-closing, Randy will become part of the Peoples team in order to support integration of the two organizations. Through the end of 2018, Randy will support systems and cultural integration, lead customer service and development, and help introduce Peoples Bank into the communities served by First Personal.”

“This combination will create a $1.1 billion asset bank that will bring tangible benefits to existing Peoples customers in this market while extending a broader array of commercial, home mortgage, and consumer loan products as well as traditional and modern electronic banking services to First Personal’s customers. We will also be able to offer trust and wealth management capabilities in this market that will complement our customers’ banking experience,” Bochnowski noted.

“The south suburban Chicagoland market is a natural extension of our home markets in Northwest Indiana, and a market where we already have a significant customer base. It shares the same cultural influences with Chicago while maintaining a unique community presence. Peoples Bank is excited to work with Randy Schwartz and the First Personal team to deliver the community banking mission that has sustained Peoples Bank for over 100 years, to help our customers and communities be more successful through our shared values of stability, integrity, community, and excellence,” Bochnowski said. “Our organization is committed to creating shared value for all of our stakeholders – shareholders, customers, employees, and the communities we serve.”

“First Personal Bank was founded on the principal of providing its customers with the best banking experience they’ve ever had,” said Randy Schwartz, chief executive officer. “We are excited to be joining with Peoples Bank so that we can continue giving that best banking experience to our existing customers, but now with an expanded product offering and more full-service locations.”

NorthWest Indiana Bancorp expects the merger to be approximately $0.51 accretive to 2019 earnings per share, approximately 5.6% dilutive to tangible book value at closing, and expects the tangible book value earnback to be approximately 3.5 years using the cross-over method. At closing, both Peoples Bank and NWIN expect to remain above all “Well-Capitalized” capital ratios.

The merger is expected to be completed in the third quarter of 2018, subject to approval by bank regulatory authorities and the shareholders of First Personal, as well as the satisfaction of other customary closing conditions. Additionally, First Personal Bank will be merged with and into Peoples Bank, and the combined operations will be continued under the Peoples Bank name.

NorthWest Indiana Bancorp was advised by Stephens Inc. and Barnes & Thornburg LLP as legal counsel. First Personal was advised by, and received a fairness opinion from, Piper Jaffray & Co., and was advised by Barack Ferrazzano Kirschbaum & Nagelberg LLP as legal counsel.