The merger has been unanimously approved by the boards of directors of both institutions and is expected to be completed in the second quarter of 2023, subject to the approval of First Bank and Malvern Bancorp shareholders, as well as customary regulatory approvals.
Malvern Bank is headquartered in Paoli, a suburb of Philadelphia, and serves its customers and communities through its nine banking locations in Chester and Delaware counties, Pennsylvania; Morristown; and Palm Beach, Florida.
Malvern Bancorp had assets of approximately $1.04 billion, loans of approximately $815.6 million and deposits of approximately $785.3 million as of Sept. 30.
Following the closing of the transaction, First Bank will have approximately $3.68 billion in assets with 27 branches located in seven New Jersey counties, three eastern Pennsylvania counties and one Florida county.
First Bank CEO Patrick Ryan said the acquisition will expand the bank’s market position and deposit share in eastern Pennsylvania while increasing the bank’s overall growth.
About First Bank
First Bank is a New Jersey state-chartered bank with 18 full-service branches in New Jersey, in Cinnaminson, Cranbury, Delanco, Denville, Ewing, Flemington (2), Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset and Williamstown — as well as Doylestown, Trevose, Warminster and West Chester, Pennsylvania.
“This merger is another example of what we believe are high-quality and low-risk transactions we are using to build size and scale, solidify our market position and expand our service area,” he said. “Malvern Bank’s emphasis on commercial lending, private banking and superior customer service create a great fit, and we are delighted to welcome Malvern Bank’s employees to the First Bank team.
“In addition, this transaction further strengthens our balance sheet through loan portfolio diversification and provides expanded access to cost-effective deposits. Importantly, we expect the transaction will be significantly and immediately accretive to First Bank earnings per share and that the earn back on tangible book dilution to be under two and a half years. First Bank’s regulatory capital levels will remain strong, enabling us to continue to evaluate all appropriate growth opportunities.”
According to terms of the merger agreement, Malvern Bancorp shareholders will receive 0.7733 of a share of First Bank common stock and $7.80 in cash per each Malvern Bancorp common share outstanding.
First Bank expects to issue approximately 5.9 million new shares of First Bank common stock and $59.4 million in cash consideration to consummate this transaction.
Based upon First Bank’s Dec. 13 closing price of $15.31 per share, the transaction is valued at approximately $149.5 million in aggregate deal value.