The Bank of San Antonio will merge with two Central Texas banks to form one bank with total assets of over $1.5 billion, the holding companies announced Tuesday.
Southwest Bancshares, holding company for The Bank of San Antonio, is combining with Capitol of Texas Bancshares, which is the holding company for The Bank of Austin, and Texas Hill Country Bancshares, which owns Texas Hill Country Bank under the Southwest Bancshares company.
Under the agreement, each of the banks will maintain their existing trade names, executive management teams, and board of directors. Terms of the transaction were not disclosed.
Officials within the three organizations authorized the merger agreement, and subject to regulatory approvals, the transaction is expected to close in the fourth quarter of this year, according to Bruce Bugg, chairman, president and CEO of all three bank holding companies.
“These three bank holding companies have many common shareholders and are affiliated with each other,” Bugg stated. “It just made strategic sense for them to combine into one Central Texas banking franchise which covers San Antonio and Austin, the second and third fastest-growing large American cities, respectively, and the Texas Hill Country which also has a strong and growing economic base.”
At the end of May, the combined banks had total assets of nearly $1.5 billion, total deposits of $1.2 billion, and total equity of $133 million.
San Antonio’s Broadway Bank has total assets of nearly $4 billion, and Jefferson Bank, $2 billion.
Founded by a group of friends in 2007, The Bank of San Antonio began with $25 million in capital and assets and has grown to more than $1 billion in assets with five banking centers in San Antonio.
In 2009, Southwest Bancshares’ founders started Texas Hill Country Bank, which has several locations in Bandera, Kerrville, and Fredericksburg. Three years ago, the group opened The Bank of Austin.
“The Bank of San Antonio’s broad depth of resources, together with our new partners’ strong local ownership, management and market intelligence, makes for a powerful combination that will enable us to continue to expand our Central Texas market share,” stated Brent Given, president and CEO of The Bank of San Antonio.
After the merger, Given will serve as executive vice president and chief operating officer of Southwest Bancshares, Inc., overseeing operations of all three banks.
Mergers and acquisitions have slowed during the pandemic and industry leaders expect that to continue. The year began with 17 bank consolidations in January, which was on the heels of one of the busiest years for mergers and acquisitions since the financial crisis, according to an American Banker report.
But the number of deals announced through June 28 has fallen 70 percent from this time a year ago, with four of those deals terminated.
