Talmer Bancorp (TLMR) in Troy, Mich., could enjoy a bigger-than-expected benefit from its purchase of Michigan Commerce Bank.
The $5.7 billion-asset company
Talmer bought Michigan Commerce from Capitol Bancorp on Jan. 1 in
Talmer also contributed nearly $80 million to recapitalize Michigan Commerce, which it renamed Talmer West Bank. To fund the moves, Talmer borrowed $35 million under a senior unsecured line of credit and received $33 million in dividend capital from its Talmer Bank and Trust.
Michigan Commerce added about $940 million in assets, including more than $600 million in loans, and $885 million in deposits, the filing said.
The bargain purchase gain is nearly double the $20 million that Christopher McGratty at Keefe, Bruyette & Woods had expected. He wrote in a Monday note to clients that, while the disclosure leaves core earnings unaffected, the higher gain could boost Talmer's tangible book value by roughly 25 cents a share. The increase "does help make the risk-reward even more attractive," he wrote.