Carmel-based Merchants Bancorp plans to beef up its small subsidiary, Joy State Bank of Joy, Illinois, with the acquisition of Paxton, Illinois-based FM Bancorp Inc. for $21.9 million.
Merchants announced Wednesday that it has entered into an agreement to acquire FM Bancorp and its banking subsidiary, Farmers-Merchants National Bank of Paxton. Pending approval from shareholders and bank regulators, the deal is expected to close in the fourth quarter.
As of March 31, FM Bancorp had total assets of $114.6 million, including gross loans of $33.6 million and deposits of $99.3 million. The company’s banking subsidiary, Farmers-Merchants National Bank of Paxton, has three branches—one each in the Illinois towns of Paxton, Melvin and Piper City. All three towns are in Ford County, north of Champaign.
Joy State Bank currently has two branch offices: one each in the Mercer County, Illinois towns of Joy and New Boston. Following the acquisition, Joy will have approximately $159 million in assets and five banking locations.
Merchants Bancorp, which went public in October, is the parent of a multipronged company that includes multifamily mortgage lender and servicer P/R Mortgage; Merchants Bank of Indiana; and Warehouse Lending, which extends credit to loan originators for residential mortgages.
As of March 31, Merchants had $3.7 billion in assets and $3.1 billion in deposits. The company turned a profit of $15.1 million, or 50 cents per share, during the first quarter.