First Bank and Malvern Bancorp, Inc. reach agreement on strategic combination
Expanded Presence in Highly Desirable New Jersey and Pennsylvania Markets
NEW JERSEY — First Bank and Malvern Bancorp, Inc. announced Wednesday that they have entered into a definitive merger agreement pursuant to which First Bank will acquire Malvern Bancorp, Inc. and Malvern Bank in a transaction valued at approximately $149.5 million.
The merger has been unanimously approved by the boards of directors of both institutions and is expected to be completed in the second quarter of 2023, subject to the approval of First Bank and Malvern Bancorp, Inc. shareholders, as well as customary regulatory approvals.
Malvern Bank is headquartered in Paoli, a suburb of Philadelphia, Pennsylvania, and serves its customers and communities through its nine banking locations in Chester and Delaware counties, Pennsylvania, Morristown, New Jersey, and Palm Beach, Florida. Malvern Bancorp, Inc. had assets of approximately $1.04 billion, loans of approximately $815.6 million and deposits of approximately $785.3 million as of September 30, 2022. Following the closing of the transaction, First Bank will have approximately $3.68 billion in assets with 27 branches located in seven New Jersey counties, three eastern Pennsylvania counties and one Florida county.
“This strategic transaction expands our market position and deposit share in eastern Pennsylvania, while complementing our strong organic growth strategy,” said Patrick L. Ryan, President and Chief Executive Officer of First Bank. “This merger is another example of what we believe are high-quality and low-risk transactions we are using to build size and scale, solidify our market position and expand our service area. Malvern Bank’s emphasis on commercial lending, private banking and superior customer service create a great fit, and we are delighted to welcome Malvern Bank’s employees to the First Bank team. In addition, this transaction further strengthens our balance sheet through loan portfolio diversification and provides expanded access to cost-effective deposits. Importantly, we expect the transaction will be significantly and immediately accretive to First Bank earnings per share and that the earn back on tangible book dilution to be under two and a half years. First Bank’s regulatory capital levels will remain strong, enabling us to continue to evaluate all appropriate growth opportunities.”
“We are excited to be combining with a financially strong and strategically well-positioned community bank,” said Anthony Weagley, President and Chief Executive Officer of Malvern Bancorp, Inc. “First Bank has an excellent track record and is successfully executing upon its vision to be a premier community bank focused on high-touch customer service throughout the New York City to Philadelphia corridor. Importantly, First Bank shares Malvern Bank’s vision of providing customers with a rewarding banking experience and the combined company will be well positioned to enhance the products and services already provided to our customers. We believe this strategic combination will benefit all the stakeholders of the combined company and we look forward to working closely with First Bank’s team to complete the transaction.”
According to terms of the merger agreement, Malvern Bancorp, Inc. shareholders will receive 0.7733 shares of First Bank common stock and $7.80 in cash per each Malvern Bancorp, Inc. common share outstanding. First Bank expects to issue approximately 5.9 million new shares of First Bank common stock and $59.4 million in cash consideration to consummate this transaction. Based upon First Bank’s December 13, 2022 closing price of $15.31 per share, the transaction is valued at approximately $149.5 million in aggregate deal value.
First Bank is a New Jersey state-chartered bank with 18 full-service branches in Cinnaminson, Cranbury, Delanco, Denville, Ewing, Flemington (2), Hamilton, Lawrence, Monroe, Pennington, Randolph, Somerset and Williamstown, New Jersey; and Doylestown, Trevose, Warminster and West Chester, Pennsylvania.
Malvern Bank conducts business from its headquarters in Paoli, Pennsylvania, a suburb of Philadelphia, and through its nine other banking locations in Chester and Delaware counties, Pennsylvania, Morristown, New Jersey, its New Jersey regional headquarters and Palm Beach Florida. The Bank also maintains a representative office in Allentown, Pennsylvania.
