Pinnacle Financial Partners has received the go-ahead from federal and state regulators for its plans to merge with CapitalMark Bank & Trust in Chattanooga and Magna Bank in Memphis.
According to a release, if shareholders give their approval and other conditions are met, the Nashville-based financial company will have a presence in Tennessee’s four largest cities.
Shareholder meetings for CapitalMark and Magna are scheduled later this month and the mergers are expected to become effective during the third quarter of the year. Pinnacle announced Monday that both the Tennessee Department of Financial Institutions and the Federal Deposit Insurance Corp. have approved the move, which grows Pinnacle’s asset base to more than $8 billion.
"This is a significant milestone for all of us at Pinnacle," Terry Turner, Pinnacle president and chief executive officer, said in the release. "We believe all of our constituencies will benefit from these mergers — associates, clients, communities and shareholders."
Pinnacle is the largest bank holding company headquartered in Nashville, with 29 offices in eight Middle Tennessee counties and five offices in Knoxville.
CapitalMark is a full-service commercial bank with four private client offices in Chattanooga, Cleveland, Knoxville and Oak Ridge. Magna Bank is a community bank based in Memphis.
The leaders of Pinnacle Financial Partners expect to issue $50 million in debt to help finance the acquisitions of CapitalMark Bank & Trust in Chattanooga and Magna Bank in Memphis as well as pay off its loan with U.S. Bank. That number is down from two weeks ago, when bank execs said they had started talks about issuing up to $60 million in subordinated debt.
Also of note from Pinnacle's latest filing: President and CEO Terry Turner first talked about a deal with CapitalMark boss Craig Holley way back in February of last year. But it took until early this year — starting with word that CapitalMark's 2014's profits would fall short of previous estimates — for the conversation to get down to terms and price. (Search for "February 10" to follow the timeline.)
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