BEACHWOOD, Ohio – Continuing the new era of bank consolidation, a Marietta company purchases the Ohio Commerce Bank in Beachwood.
Peoples Bank, which has 45 branches in the Marietta-Cambridge-Athens area and four in West Virginia and Kentucky, is
, which has only one branch in Beachwood. The transaction is worth $ 16.5 million.
Ohio Commerce focused on small business and personal accounts and mortgages for individuals.
âIt’s bittersweet for the founders. It’s kind of our baby,â said Dell Duncan, CEO of Ohio Commerce.
was launched in 2006, as the country entered the worst banking crisis since the Great Depression. Despite the tough environment, the bank has gone from $ 20 million in loans and $ 22 million in deposits after the first year to $ 87 million in loans and $ 106 million in deposits today.
Duncan said the bank grew in part because it wanted to do business with small companies that were shunned by the big banks during the recession.
Ohio Commerce, which started with $ 600,000 in seed money from eight investors, was Cuyahoga County’s first start-up bank since 1992. Peoples was founded in 1902.
Only a few of Ohio Commerce’s 28 employees will lose their jobs, Duncan said. Those made redundant will receive a two-week severance package for each year of service.
When Ohio Commerce opened, investors expected to sell around 2014, Duncan said. The board decided to sell a little earlier than expected after Ohio Commerce was approached last year. The bank hired a company to shop the bank. Of the 23 banks approached, seven were potentially interested in buying Ohio Commerce, which narrowed the list to three bidders.
Ohio Commerce had about 100 investors who will now benefit from the sale, Duncan said.
Industry experts and bank executives themselves predict a wave of buying and selling in the months and years to come, especially among smaller banks trying to cope with increased regulatory costs and margins. weaker beneficiaries.
In February, Park View Federal Savings in Solon announced the sale to FNB Corp. Hermitage, Pa. in a deal worth $ 106.4 million. Park View has 16 branches, 180 employees and approximately $ 700 million in deposits.
Last fall, Westfield Bank in Medina County, with five branches, purchased Western Reserve Bank, which had three local branches. Also last fall, FirstMerit Corp. Akron nearly doubled its size by acquiring Citizens Republic Bancorp, which has branches in three states, including 14 in Greater Cleveland.
Peoples have said they want to expand into northeast Ohio. “We are delighted to continue to expand our presence while acquiring a successful bank that complements our current growth strategy”,
, president and chief executive officer of Peoples, said in a statement.
The name of Ohio Commerce will become Peoples. Duncan said he expects the environment to stay the same except that it will offer more products and services.
Duncan noted that Peoples’ senior executives have roots in Northeast Ohio, with terms at KeyCorp and FirstMerit.
Sulerzyski applauded what Ohio Commerce has built in such a short time. “
and the Ohio Commerce team have done a great job creating a franchise that focuses on the banking needs of small businesses and local entrepreneurs, âhe said. “We are excited about the opportunity to provide our extensive product offering and a full range of financial expertise to Ohio Commerce clients.”
Sulerzyski said Peoples is “large enough to provide the same products and services as the major banks in the region, but with a much higher degree of personalized service.” Its objectives include local decision making.
, President of Ohio Commerce, said, âWe are delighted to be affiliated with an exceptional community bank such as Peoples, and we believe this transaction will be beneficial to our customers and our community. He said customers will have access to more products and services, including pension plan services, investments, insurance and more business loan products. Kline also expects the bank to have a “significantly higher” loan limit.
It’s Duncan’s second turn to start and sell a bank. He was one of the executives of Commerce Exchange Bank, which he helped found in the 1980s before it was sold to the Second National Bank of Warren in 1991.
Ohio Commerce was among an elite group of Northeast Ohio banks with the highest financial strength rating – five stars. More recently, however, it has fallen to four stars, which is excellent, due to a bad business loan last year.