Greensburg-based MainSource Financial Group agreed Monday to pay $34 million in cash and stock for MBT Bancorp, the parent of Merchants Bank and Trust Co.
MBT is based in the southeastern Indiana town of West Harrison and operates six bank branches—three in the Cincinnati area and three in Indiana’s Dearborn County.
The six Merchants locations will become MainSource branches when the deal closes, likely in the third quarter, the banks said.
MainSource entered the Cincinnati market earlier this year by opening a loan-production office and is looking to expand its presence in the city. It has an existing branch in West Harrison.
The acquisition “strengthens our footprint in Dearborn County and enhances our growth strategy in Cincinnati, an area where we have already been investing, and presents an opportunity to prudently and accretively deploy our strong capital base,” MainSource CEO Archie Brown said in a prepared statement.
Merchants Bank and Trust was founded in West Harrison in 1929, four months before the stock market crash of 1929.
As of Dec. 31, 2013, Merchants had about $225.2 million in assets, $180.2 million in loans, $187.9 million in deposits and $23.9 million of total equity.
MainSource operates 74 bank branches in Indiana, Illinois, Kentucky and Ohio. It has assets of about $2.9 billion.
MainSource entered the Indianapolis market in 2012 with a high-profile branch at the southeast corner of Meridian and Washington streets, in space formerly occupied by a Borders bookstore. It also has area branches in Anderson, Greenwood, Whiteland, Bargersville, Franklin and Shelbyville, and a loan office on the south side of Indianapolis.
MainSource shares were up 7.3 percent Tuesday, to $17.46 each.