F.N.B. Corporation (“FNB”) (NYSE: FNB) and Howard Bancorp, Inc.
(“Howard”) (NASDAQ: HBMD) today announced the signing of a
definitive merger agreement for FNB to acquire Howard, including
its wholly-owned banking subsidiary, Howard Bank, in an all-stock
transaction valued at $21.96 per share, or a fully diluted market
value of approximately $418 million, based upon the closing stock
price of FNB as of Monday, July 12, 2021.
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Howard, based in Baltimore, Maryland, had approximately $2.6
billion in total assets, $2.0 billion in total deposits and $1.9
billion in total loans and leases at March 31, 2021, and operates
13 full-service banking offices in Baltimore and the greater
Washington, D.C., area. This strategically significant merger will
enhance FNB’s growth trajectory and deepen FNB’s long-standing
presence in its dynamic Mid-Atlantic Region, which includes
Maryland, the Washington, D.C., metropolitan area and northern
Virginia.
Following the proposed merger with Howard, on a pro-forma basis,
FNB will have approximately $41 billion in total assets, $32
billion in deposits and $27 billion in total loans. Under the terms
of the merger agreement, which has been unanimously approved by the
Boards of Directors of both companies, stockholders of Howard will
be entitled to receive 1.8 shares of FNB common stock for each
share of Howard common stock they own. The exchange ratio is fixed,
and the transaction is expected to qualify as a tax-free exchange
for Howard’s stockholders. Simultaneously with the parent company
merger, Howard Bank will merge with and into FNB’s subsidiary,
First National Bank of Pennsylvania.
Vincent J. Delie, Jr., Chairman, President and Chief Executive
Officer of F.N.B. Corporation stated, “FNB and Howard share a deep
cultural commitment to client and community service. Combined, we
will have the sixth largest deposit share in the Baltimore market,
reinforcing our strong presence and presenting our organizations
with the opportunity to deliver an enhanced experience for our
customers, communities and dedicated teams.”
“Howard Bank has long committed to building our relevance to our
stakeholders as well as our impact on our communities. FNB, in
turn, has a long-standing reputation in Maryland as a premier
financial institution that is similarly committed to building
meaningful relationships with its clients and communities,” said
Mary Ann Scully, Chairman and Chief Executive Officer of Howard
Bancorp, Inc. “Our partnership will add enviable scale and greater
access to a comprehensive set of products, services and broader
in-market expertise that we believe will result in an enhanced
customer experience for both our core commercial base and our
growing retail clientele.”
FNB expects the merger to be 4% accretive to earnings per share
with fully phased-in cost savings on a GAAP basis and expects the
merger to enhance FNB’s profitability metrics. Additionally, FNB
anticipates the tangible book value per common share impact to be
minimal and expects the CET1 ratio to remain unchanged on a pro
forma basis at closing.
FNB and Howard expect to complete the transaction and
integration in early 2022 after satisfaction of customary closing
conditions, including regulatory approvals and the approval of
Howard’s stockholders.
Morgan Stanley & Co. LLC served as financial advisor and
Reed Smith LLP served as legal counsel to FNB. Keefe, Bruyette
& Woods, A Stifel Company, served as financial advisor and
Nelson Mullins Riley & Scarborough LLP served as legal counsel
to Howard.
An investor presentation will be available through the “About
Us” section of FNB’s website at www.fnbcorporation.com by clicking
on “Investor Relations” then “Investor & Analyst
Presentations,” or in the filings of FNB and Howard on the SEC’s
website at www.sec.gov.
ADDITIONAL INFORMATION ABOUT THE MERGER AND WHERE TO FIND
IT
This joint press release is being made in respect of the
proposed merger transaction between FNB and Howard. In connection
with the proposed merger, FNB will file a registration statement on
Form S-4 with the SEC to register FNB’s shares that will be issued
to Howard’s stockholders in connection with the merger. The
registration statement will include a proxy statement of Howard and
a prospectus of FNB, as well as other relevant documents concerning
the proposed transaction.
INVESTORS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE
PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER WHEN IT BECOMES
AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS
WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of such jurisdiction.
The proxy statement/prospectus and other relevant materials
(when they become available), and any other documents FNB and
Howard have filed with the SEC, may be obtained free of charge at
the SEC's website at www.sec.gov. In addition, investors and
security holders may obtain free copies of the documents FNB has
filed with the SEC by contacting James Orie, Chief Legal Officer,
F.N.B. Corporation, One North Shore Center, Pittsburgh, PA 15212,
telephone: (724) 983-3317; and may obtain free copies of the
documents Howard has filed with the SEC by contacting Joseph
Howard, Chief Legal Officer, Howard Bancorp, Inc., 3301 Boston
Street, Baltimore, MD 21224, telephone: (443) 573-2664.
Participants in the Solicitation
FNB and Howard and certain of their directors and executive
officers may be deemed to be participants in the solicitation of
proxies from Howard’s stockholders in connection with the proposed
merger. Information regarding FNB’s directors and executive
officers is contained in FNB’s Proxy Statement on Schedule 14A,
dated March 26, 2021, and in certain of its Current Reports on Form
8-K, which are filed with the SEC. Information regarding Howard’s
directors and executive officers is contained in Howard’s Proxy
Statement on Schedule 14A, dated April 13, 2021, and in certain of
its Current Reports on Form 8-K, which are filed with the SEC.
Additional information regarding the interests of those
participants and other persons who may be deemed participants in
the transaction may be obtained by reading the Proxy
Statement/Prospectus regarding the proposed merger when it becomes
available. Free copies of these documents may be obtained as
described in the preceding paragraph.
About F.N.B. Corporation
F.N.B. Corporation (NYSE:FNB), headquartered in Pittsburgh,
Pennsylvania, is a diversified financial services company operating
in seven states and the District of Columbia. FNB’s market coverage
spans several major metropolitan areas including: Pittsburgh,
Pennsylvania; Baltimore, Maryland; Cleveland, Ohio; Washington,
D.C.; and Charlotte, Raleigh, Durham and the Piedmont Triad
(Winston-Salem, Greensboro and High Point) in North Carolina. The
Company has total assets of more than $38 billion and nearly 340
banking offices throughout Pennsylvania, Ohio, Maryland, West
Virginia, North Carolina, South Carolina, Washington, D.C., and
Virginia.
FNB provides a full range of commercial banking, consumer
banking and wealth management solutions through its subsidiary
network which is led by its largest affiliate, First National Bank
of Pennsylvania, founded in 1864. Commercial banking solutions
include corporate banking, small business banking, investment real
estate financing, government banking, business credit, capital
markets and lease financing. The consumer banking segment provides
a full line of consumer banking products and services, including
deposit products, mortgage lending, consumer lending and a complete
suite of mobile and online banking services. FNB's wealth
management services include asset management, private banking and
insurance.
The common stock of F.N.B. Corporation trades on the New York
Stock Exchange under the symbol "FNB" and is included in Standard
& Poor's MidCap 400 Index with the Global Industry
Classification Standard (GICS) Regional Banks Sub-Industry Index.
Customers, shareholders and investors can learn more about this
regional financial institution by visiting the F.N.B. Corporation
website at www.fnbcorporation.com.
About Howard Bancorp, Inc.
Howard Bancorp, Inc. is the
parent company of Howard Bank, a Maryland-chartered trust company
operating as a commercial bank. Headquartered in Baltimore City,
Maryland, Howard Bank operates a general commercial banking
business through its 13 branches located throughout the Greater
Baltimore Metropolitan Area. Additional information about Howard
Bancorp, Inc. and Howard Bank is available on its website at
www.HowardBank.com.
Cautionary Statement Regarding Forward-Looking
Information
This joint press release of FNB and Howard contains
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act. These forward-looking statements
include, but are not limited to, statements regarding the outlook
and expectations of FNB and Howard with respect to their planned
merger, the strategic benefits and financial benefits of the
merger, including the expected impact of the transaction on the
combined company’s future financial performance (including
anticipated accretion to earnings per share and other metrics), and
the timing of the closing of the transaction.
Forward-looking statements are typically identified by words
such as "believe," "plan," "expect," "anticipate," "intend,"
"outlook," "estimate," "forecast," "will," "should," "project,"
"goal," and other similar words and expressions. Forward-looking
statements are subject to risks, uncertainties and assumptions
which may change over time or as a result of unforeseen
circumstances. Future events or circumstances may change
expectations or outlook and may affect the nature of the
assumptions, risks and uncertainties to which forward-looking
statements are subject. The forward-looking statements in this
press release pertain only to the date of this press release, and
FNB and Howard disclaim any obligation to update or revise any
forward-looking statements, except as required by law. Actual
results or future events may differ, possibly materially, from
those that are anticipated in these forward-looking statements.
Accordingly, we caution against placing undue reliance on any
forward-looking statements.
Forward-looking statements contained in this press release are
subject to, among others, the following risks, uncertainties and
assumptions:
- The possibility that the anticipated benefits of the
transaction, including anticipated cost savings and strategic
gains, are not realized when expected or at all, including as a
result of the impact of, or problems arising from, the integration
of the two companies or as a result of the strength of the economy,
competitive factors in the areas where FNB and Howard do business,
or as a result of other unexpected factors or events;
- Completion of the transaction is dependent on the satisfaction
of customary closing conditions, including approval by Howard
stockholders, which cannot be assured, and the timing and
completion of the transaction is dependent on various factors that
cannot be predicted with precision at this point;
- The occurrence of any event, change or other circumstances that
could give rise to the right of one or both of the parties to
terminate the merger agreement;
- Completion of the transaction is subject to bank regulatory
approvals and such approvals may not be obtained in a timely manner
or at all or may be subject to conditions which may cause
additional significant expense or delay the consummation of the
merger transaction;
- Potential adverse reactions or changes to business or employee
relationships, including those resulting from the announcement or
completion of the transaction;
- The outcome of any legal proceedings that may be instituted
against FNB or Howard;
- Subsequent federal legislative and regulatory actions and
reforms affecting the financial institutions’ industry may
substantially impact the economic benefits of the proposed
merger;
- Unanticipated challenges or delays in the integration of
Howard’s business into FNB’s and or the conversion of Howard’s
technology systems and customer data may significantly increase the
expense associated with the transaction; and
- Other factors that may affect future results of FNB and Howard,
including changes in asset quality and credit risk; the inability
to sustain revenue and earnings growth; changes in interest rates
and capital markets; inflation; customer borrowing, repayment,
investment and deposit practices; the impact, extent and timing of
technological changes; capital management activities; and other
actions of the Federal Reserve Board and legislative and regulatory
actions and reforms.
These forward-looking statements are also subject to the
principal risks and uncertainties applicable to FNB’s and Howard’s
respective businesses and activities generally that are disclosed
in FNB’s 2020 Annual Report on Form 10-K and in other documents FNB
files with the SEC, and in Howard’s 2020 Annual Report on Form 10-K
and in other documents Howard files with the SEC. FNB’s and
Howard’s SEC filings are accessible on the SEC website at
www.sec.gov.
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version on businesswire.com: https://www.businesswire.com/news/home/20210713005457/en/
Analyst/Institutional Investor Contact: Lisa Constantine,
412-385-4773 constantinel@fnb-corp.com
Media Contact: Jennifer Reel, 724-983-4856, 724-699-6389
(cell) reel@fnb-corp.com
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