Iowa City, Iowa-based MidWestOne Bank is selling its two Florida branches to Dearborn, Mich.-based DFCU Financial in an all-cash deal.
By acquiring the branches in Naples and Fort Myers, the $6.3 billion DFCU will add $159 million in deposits and $162 million in loans.
According to the $6.5 billion bank, Florida was identified as a non-core market this year during its long-term strategic planning process. MidWestOne CEO Chip Reeves said the divestiture will help it scale its targeted growth to markets in Iowa, Denver and the Twin Cities.
“We reviewed our geographic footprint with a focus on improving scale, and ultimately, profitability,” he added. “While our Florida operations have been performing well, we never reached the scale to allow this market to become a growth driver for MidWestOne without significant investment. This divestiture is an important step in the successful execution of our strategic plan.”
DFCU, which entered Florida in January by acquiring Tampa-based First Citrus Bank, will grow its Florida branch count to eight once the deal is finalized in the second quarter of next year. DFCU is expected to retain all MidWestOne Florida employees and keep both branches open.
“This move enhances our capacity to serve our members and communities in Florida, providing additional convenience and local expertise,” said Ryan Goldberg, DFCU president and CEO.
DFCU is being advised by Grosse Pointe Woods, Mich.-based investment banking firm Donnelly Penman & Partners, Inc., and Detroit-based law firm Honigman LLP. MidWestOne is being advised by Inverness, Ill.-based investment banking firm Hovde Group LLC, and Chicago-based law firm Barack Ferrazzano Kirschbaum & Nagelberg LLP.