Community & Southern Bank (CSB) of Atlanta announced Monday that it has entered into an agreement to purchase Essex Bank’s Georgia branches in Loganville, Snellville, Grayson and Covington. Under terms of the agreement, CSB will acquire approximately $192 million in deposits and no loans.
According to Essex, it will sell the four branch offices, their fixtures and furnishings to CSB for approximately $5.2 million, "a slight discount to the net book value of those assets." It will sell the deposits at a premium of 1.33 percent, subject to a "good-faith renegotiation in the event that the amount of deposits to be sold decreases by $10 million prior to the closing of the transaction.’’
The transaction is expected to close in the fourth quarter, subject to regulatory approval. When the transaction is closed, each Essex branch will become a CSB branch.
"We are very pleased to welcome these new clients to CSB and, in conjunction with Essex Bank, to provide them uninterrupted banking service," said Pat Frawley, chief executive officer of CSB. "CSB shares a common commitment to customer service with Essex Bank and we look forward to serving our new clients and communities.’’
Virginia-based Essex, the banking subsidiary of Community Bankers Trust Corporation, had bought its four Georgia branches from the Federal Deposit Insurance Corp. after Loganville-based Community Bank failed in November 2008. Essex Bank says it does not expect to record a material gain or loss in connection with the transaction in 2013. The sale of the Georgia branches and deposits is expected to result in annual net cost savings of $1.2 million for the Bank.
The four branches will operate normally through completion of the transaction, according to Essex, and customers do not need to take any action. Essex Bank and CSB will contact all customers, they said.