Rosemont, Ill.-based Wintrust Financial Corp. has signed a definitive agreement to acquire Generations Bancorp Inc., the parent company of Pewaukee-based Foundations Bank, for about $30 million.
As of Sept. 30, Foundations had about $125 million in assets, $72 million in loans and about $97 million in deposits, according to a release from Wintrust.
“We are excited about the opportunity to combine resources with Wintrust,” said John Hazod
, president and chief executive officer of Foundations Bank. “This is a great opportunity to partner with a successful organization that is compatible with ours. We share a philosophy of offering highly personalized customer-oriented retail and commercial banking services. The transaction allows us to continue focusing on serving our customers, while at the same time providing our customers with access to a wider range of products and services. We see many benefits for our shareholders and customers, and we look forward to joining the Wintrust family.”
Wintrust has been active in acquiring southeastern Wisconsin banks over the past several years. The bank holding company acquired Town Bankshares Ltd.
, parent company of Hartland-based Town Bank, in 2004. Wintrust then acquired the Pewaukee branch of THE National Bank
and Talmer Bancorp.’s 11 Wisconsin Talmer Bank and Trust branches
in April 2014, folding them into Town Bank. In January 2015, Wintrust acquired Delavan-based Delavan Bancshares Inc.
, parent company of Community Bank CBD, for $38 million and folded it into Town Bank as well.
“This transaction provides a wonderful opportunity to expand and complement our market presence in Pewaukee,” said Edward Wehmer, president and chief executive officer of Wintrust. “We look forward to continuing with the community banking approach that Foundations Bank has established and to providing its customer base with an expanded array of products and services."
The transaction is expected to close in the second quarter. Shares of Generations common stock outstanding upon the completion of the acquisition will be converted to the right to receive merger consideration paid in cash.
Godfrey & Kahn S.C. served as legal advisor and Hovde Group LLC acted as exclusive financial advisor for Generations.
Wintrust, which also operates banks in Illinois, holds 15 community banks with more than 150 branches. It has $22.9 billion in assets and more than 4,000 employees.
Wintrust intends to continue growing both organically and through acquisition across its network, Wehmer said in a call with analysts today.
"We intend to continue to build and grow in that Wisconsin area," he said. "We see other small opportunities. We still tend to like those bolt-ons...there's a large population of banks about that size in our service area."
Wintrust today reported fourth quarter net income of $35.5 million, or 64 cents per diluted common share, down from $38.1 million, or 75 cents per share, in the fourth quarter of 2014.
Revenue was $232.3 million in the fourth quarter, up from $211.4 million in the same period a year ago.
The fourth quarter included acquisition and non-operating compensation charges of $6.5 million.
Full-year net income was $156.7 million, or $2.93 per share, up from $151.4 million, or $2.98 per share, in 2014. Wintrust reported 2015 revenue of $913.1 million, up from $813.8 million last year.
The company incurred $14 million in acquisition and non-operating compensation charges in 2015.
“Wintrust reported record annual net income in 2015 even with additional acquisition and non-operating compensation charges during the year,” Wehmer said. “The company grew significantly during the year as total assets increased by 15 percent, reaching nearly $23 billion. Operating net income totaled $39.5 million for the fourth quarter of 2015 and $165.7 million for the full year as earnings were impacted by acquisition and non-operating compensation charges totaling $6.5 million pre-tax in the fourth quarter of 2015 and $14.0 million pre-tax for the full year. Additionally, the fourth quarter of 2015 was highlighted by continued strong loan and deposit growth, improvement in non-performing assets and decreased mortgage banking revenue."