Meta Financial Group in Sioux Falls, S.D., has agreed to sell its community bank division to Central Bank in Storm Lake, Iowa.
The $6 billion-asset Meta said in a press release Wednesday that the deal includes branches in Iowa and South Dakota, along with $270 million in assets and $265 million in loans. Meta will retain and run off another $935 million in loans that will be serviced by the $900 million-asset Central.
The deal is expected to close in the first quarter.
Meta did not disclose how many branches it would sell. The company had six branches in Iowa and five in South Dakota on June 30, based on the most recent data from the Federal Deposit Insurance Corp.
The agreement “will allow both companies to focus on their core businesses and provide the highest level of service and value to the customers, employees and shareholders,” Brad Hanson, Meta’s president and CEO, said in the release.
"This transaction aligns with Meta's strategy to focus on improving yields from our national lending platforms, growing deposits in our payments division and improving efficiencies by streamlining operations; while serving key markets often overlooked by traditional banks,” Hanson added.
Central agreed to offer employment to all of MetaBank’s community bank employees.
Meta said the acquisition should result in a pretax gain of about $18.5 million. The company said it plans to deploy capital generated from the sale into share repurchases, among other things.
Separately, Meta said it disposed of assets tied to a previously disclosed agricultural relationship that were held in other real estate owned. Meta said it expects to incur a pretax loss of about $4.3 million in the fourth quarter tied to the disposition.
Sandler O’Neill and Katten Muchin Rosenman advised MetaBank. Nick Brown Law Firm and Belin McCormick advised Central.
