On the heels of announcing the $64 million purchase of Fourth Street Banking Co., the parent of Freedom Bank, the top executive at Seacoast Banking Corp. of Florida has made it clear.
He’s not done shopping around.
Seacoast (Nasdaq: SBCF), headquartered in Stuart and with $7.1 billion in assets, remains focused on building out its Florida franchise, Dennis Hudson III, Seacoast’s chairman and CEO, said during a conference call with analysts on Friday. “We will remain focused on opportunities to strengthen our position in Florida’s higher growth metro markets, including Tampa-St. Pete, Orlando, South Florida, and also helping us continue to build operating leverage.”
Seacoast National Bank entered the Tampa-St. Pete market in 2017 with the acquisitions of GulfShore Bank and NorthStar Bank, both based in Tampa. Seacoast currently has one branch in St. Petersburg, a former GulfShore office at 965 Central Ave. downtown.
With St. Petersburg-based Freedom Bank and its $306 million in assets, Seacoast is getting more than just a bank. Seacoast is getting “a great market,” Hudson said in response to a question from David Feaster, an analyst at Raymond James & Associates.
“We love the Tampa-St. Pete market. It’s a tremendous market. It’s twice the size of Orlando and it’s the second-largest MSA in the state of Florida. It is full of opportunities for us both in terms of customers and bankers,” Hudson said. “We’ve continued to expand our banker pool in the market and just here in the fourth quarter added across the franchise another seven commercial bankers and another nine MLOS [mortgage loan originators]. So we continue to expand distribution. We think the markets are serving as well. We continue to see strong population growth in the markets and great opportunities for growth. So this gives us to more scale there. The team that operates in the St. Pete market has operated there for many years (and) is well regarded, well-thought of and its staying on with us and is excited about the opportunity to work with us.”
Cathy Swanson, Freedom Bank CEO, will be Pinellas County market president for Seacoast, and her team is staying on as well.
“As Cathy and her team get together and assimilate with our position there, it just builds an even stronger presence for her and for her bank in that market and we’re really excited about the talent that is coming with that acquisition,” said Chuck Shaffer, Seacoast’s chief operating officer and chief financial officer. “Also there’s good support on the part of shareholders there. We’ve grown to really appreciate some of the deep connections they have in the market. And so we’re really, really excited about being in a much stronger position in Pinellas County.”
When the deal for Freedom Bank closes, Seacoast will be the largest Florida-based bank in St. Petersburg and the third largest Florida-based community bank in the Tampa-St. Pete metro area, Hudson said.
Overall, including out-of-state-based regional and national banks, Seacoast will be the 17th largest bank in the metro area, with more than $678 million in local deposits, according to Raymond James.
Fourth Street Banking Co. shareholders will receive 0.1275 shares of Seacoast common stock, based on Seacoast’s Jan. 22 closing price of $29.39 a share. That values the transaction at about $63.6 million, or $3.75 a share. That’s 1.74 times Fourth Street’s tangible book value, including Fourth Street debt that will be converted to equity.
The deal is expected to close in mid-to-late second quarter of 2020.