Cincinnati-based First Financial Bancorp and Greensburg-based MainSource Financial Group plan to sell off five bank branches in Indiana to resolve regulatory concerns that could stand in the way of their planned $1 billion merger.
First Financial is expected to complete its acquisition of MainSource late this quarter.
The banks said Monday that they reached an agreement with the U.S. Department of Justice to divest four MainSource branches in Columbus and another MainSource branch in Greensburg.
“The divestiture is designed to resolve competitive concerns raised by the DOJ regarding the pending merger of First Financial and MainSource,” the banks said in a public filing.
The agreement calls for the branches to be sold within 180 days of the closure of the merger. The divestures include all deposits and loans, plus all real and personal property.
Slated to be sold are the branch in Greensburg Plaza and Columbus branches at 529 Washington St., 803 Washington St., 1901 25th St., and 2310 W Jonathan Moore Pike.
The banks said the divestitures are “not anticipated to have a material impact on the financial metrics of the proposed merger or the combined company following the merger.”
The banks said they’ll continue to operate each branch and maintain its personnel until each branch is sold.
As of Sept. 30, First Financial had $8.8 billion in assets and 102 offices in Indiana, Ohio and Kentucky. MainSource, meanwhile, had $4.6 billion in assets and 94 branches in Indiana, Illinois, Ohio and Kentucky.
The institutions said they plan to realize about $43 million in annual cost savings, in part by closing 45 to 50 branches.
Once the deal closes, First Financial is expected to have 16 branches in the Indianapolis market, double its current presence. It will rank sixth in deposit market share for all of Indiana and fourth in the Cincinnati market, according to an investor presentation the two institutions distributed last summer.