Old National Bancorp in Evansville, Ind., is trimming its branch network in a move that gives La Crosse, Wis.-based Marine Credit Union an expanded footprint.
The $17.5 billion-asset company disclosed in a press release for first-quarter earnings that it will sell 10 branches in Wisconsin, along with $274 million in deposits, to Marine CU. No loans are changing hands.
The branch sale is expected to close in the third quarter. Old National did not disclose the price Marine will pay.
Old National said it will also close 10 branches. The moves will reduce the size of the company's branch network by about 10%.
“We are pleased to partner with Old National, a bank that shares our values, to continue providing excellent service and competitive products to customers in these communities throughout Wisconsin,” Shawn Hanson, Marine Credit Union CEO, said in a press release, adding: “As a mission-focused credit union, we strive to make life better for those around us: our members, our employees and our communities. This acquisition furthers our growth strategy and aligns with our mission. We look forward to welcoming our new employees and new customers as members of Marine Credit Union.”
The sales and closures are tied to an “ongoing focus on improving the operating dynamics of the franchise," Robert Jones, Old National's chairman and CEO, said in a separate press release.
Old National's earnings rose by 33% from a year earlier, to $47.9 million, or 31 cents a share. The results were skewed by merger and integration costs, as well as branch consolidation costs.
Net interest income increased by 22% to $128.6 million. Total loans increased by 23% to $11.2 billion, while the net interest margin narrowed by 5 basis points to 3.45%.
Noninterest income fell by 1.2% to $42.4 million, reflecting lower capital markets income and a seasonal decline in deposit services charges.
Noninterest expense rose by 16% to $117.6 million. Merger and integration costs, branch charges and seasonal factors including snow removal affected noninterest expense.
For its part, Marine CU earned about $5.7 million last year, with more than $610 million in loans and leases on the books, driven primarily by used auto and real estate loans. It is well capitalized with a net worth ratio of 10.76 percent, according to data filed with the National Credit Union Administration. Marine Credit Union has branch locations in Iowa, Minnesota and Wisconsin.