Combination Solidifies First Internet Bank’s Position as a Premier Technology-Forward, Growth-Oriented Digital Financial Services Provider
First Internet Bancorp , the parent company of First Internet Bank , announced it has entered into a definitive agreement to acquire First Century Bancorp , the parent company of First Century Bank, N.A. Headquartered in Roswell, GA, First Century is a technology-driven financial solutions company with lines of business focused on Payments, Tax Product Lending, Sponsored Card Programs and Homeowners Association (“HOA”) Services. These attractive and scalable business lines provide First Internet multiple growth opportunities, further diversification of its revenue profile and access to a stable, low-cost deposit base.
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“We are proud of our history of innovation and growth, and we are thrilled to join forces with an organization we view as the perfect strategic and cultural partner”
David Becker, Chairman and Chief Executive Officer of First Internet, commented, “The acquisition of First Century is an important opportunity for our organization. First, it aligns with our strategy of operating unique and scalable businesses with nationwide platforms. Second, it allows us to continue to diversify and grow our revenue streams in a capital efficient manner. And, importantly, First Century’s success in the HOA business grants us access to a very attractive deposit base, with opportunity to expand.”
Mr. Becker continued, “First Century is a highly profitable company with a strong track record of growth in providing technology-enabled services to a national client roster of premier business partners. We are always looking for exceptional financial technology partners that help us further our leadership position in digital banking; the acquisition of First Century is a great fit. We expect to leverage our national infrastructure to boost First Century’s growth opportunities and drive stronger returns for our shareholders. We are excited to welcome the First Century team to First Internet; together, we have an opportunity to build something truly special.”
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“We are proud of our history of innovation and growth, and we are thrilled to join forces with an organization we view as the perfect strategic and cultural partner,” said First Century Chairman and CEO William Blanton. “This is a natural step in our evolution and a very positive development for our customers and business partners. We believe First Internet’s larger balance sheet, digital banking expertise and broader array of products will enhance our existing client relationships and enable us to drive long-term growth for the combined organization.”
According to the terms of the definitive agreement, First Internet will acquire all of the outstanding shares of First Century common stock for $80.0 million in cash, which First Internet will fund with available on-balance sheet cash. As of September 30, 2021, First Century had total assets of $408 million, total deposits of $330 million, and total loans of $32 million.
The transaction is expected to be 21% accretive to 2023 earnings per share and 7% dilutive to tangible book value per share, with a tangible book value earnback period of approximately 3 years.
Upon completion of the acquisition, First Century Bank will merge into the Bank and maintain operations of its lines of business in its current locations. First Century operates a branch in Commerce, GA to support its consumer and small business banking services, with another branch in Hilton Head Island, S.C. that supports certain lines of business. Substantially all of First Century’s employees are expected to join First Internet, including key members of First Century’s senior management team.
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First Internet’s and First Century’s respective boards of directors have unanimously approved the merger agreement. Additionally, directors and executive officers of First Century have entered into agreements whereby they have committed to vote their shares in favor of the transaction. The closing of the acquisition is subject to satisfaction of customary closing conditions, including regulatory approvals and approval of First Century shareholders. The transaction is anticipated to close in the first quarter of 2022.
