Southern Missouri Bancorp, Inc. Announces Completion of Merger With Citizens Bancshares Co.

Rhea-AI Summary

Southern Missouri Bancorp, Inc. (NASDAQ: SMBC) has successfully completed its merger with Citizens Bancshares Co., based in Kansas City, Missouri. This merger enhances Southern Missouri’s footprint, bringing its total banking facilities to 65 across Missouri, Kansas, Illinois, and Arkansas. Citizens Bank & Trust now operates as a subsidiary of Southern Missouri. Shareholders of Citizens will receive either 1.1755 shares of Southern Missouri stock or $54.93 in cash per share, with a total merger consideration of approximately $131.4 million. The merger will increase combined assets to about $4.4 billion, including $3.4 billion in loans.

Positive

• Expansion to 65 banking facilities, increasing market presence.
• Acquisition of Citizens Bank's strong core deposit base enhances funding mix.
• Pro forma assets post-merger are approximately $4.4 billion, improving financial stability.

Negative

• Integration challenges may cause higher-than-expected costs and difficulties.
• Potential adverse impacts from economic conditions and COVID-19 ongoing effects.

Poplar Bluff, Missouri, Jan. 20, 2023 (GLOBE NEWSWIRE) --

Southern Missouri Bancorp, Inc. (“Southern Missouri” or the “Company,” NASDAQ: SMBC), parent company of Southern Bank, Poplar Bluff, Missouri, announced that its merger with Citizens Bancshares Co. (“Citizens”), Kansas City, Missouri, was completed today. Citizens was the parent company of Citizens Bank & Trust Company, which has become a subsidiary of Southern Missouri effective with the closing of the merger.

Following the completion of the merger, Southern Missouri now operates 65 banking facilities in Missouri, Kansas, Illinois, and Arkansas. Greg Steffens, Chairman and Chief Executive Officer of Southern Missouri, commented, “We are very pleased to welcome the team members and valued customers of Citizens Bank & Trust Company to our Southern Bank family. We are looking forward to participating in the continued growth of the excellent communities they call home, including the Kansas City metropolitan area, and Citizens’ strong core deposit base will be a meaningful addition to our funding mix.”

In conjunction with the merger, William Young, President of Citizens Bank & Trust Company, has joined the boards of directors of Southern Missouri and Southern Bank. “We at Citizens are pleased and excited to become a part of the Southern Bank family and the team here looks forward to serving our customers with the advantage of their size, number of branches, and diverse package of products and services to offer our clients. At the same time, our merger will allow Southern Bank to offer trust services to their existing customer base, and significantly grow their wealth management group. I am excited about joining the Board of Directors of Southern Missouri Bancorp and Southern Bank,” said Mr. Young.

As a result of the merger, each share of Citizens common stock held immediately prior to completion of the merger is being exchanged for 1.1755 shares of Southern Missouri common stock or $54.93 in cash (as adjusted based on Citizens’ capital and the total number of shares outstanding immediately prior to closing) at the election of the shareholders, subject to the proration and allocation procedures set forth in the merger agreement. Cash will be paid in lieu of any fractional shares of Southern Missouri common stock. Southern Missouri paid approximately $131.4 million in merger consideration, comprised of stock and cash at a 74:26 ratio.

At December 31, 2022, Citizens reported total consolidated assets of $973 million, including loans, net, of $463 million, and deposits of $838 million. On a pro forma basis, the combined entity will hold assets of approximately $4.4 billion, including loans, net, of $3.4 billion, and deposits of $3.8 billion.

The firm of Stinson LLP served as legal advisor to Citizens, while Silver, Freedman, Taff & Tiernan LLP served as legal advisor to Southern Missouri. D.A. Davidson served as financial advisor to Citizens and Piper Sandler served as financial advisor to Southern Missouri.

Forward-Looking Information:

Except for the historical information contained herein, the matters discussed in this press release may be deemed to be forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors that could cause the actual results to differ materially from the forward-looking statements, including: expected cost savings, synergies and other benefits from Southern Missouri's merger and acquisition activities, including this acquisition and Southern Missouri's other acquisitions, might not be realized within the anticipated time frames or at all, and costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected; potential adverse impacts to economic conditions in the Company’s local market areas,  other markets where the Company has lending relationships, or other aspects of the Company’s business operations or financial markets, generally, resulting from the ongoing COVID-19 pandemic and any governmental or societal responses thereto; the strength of the United States economy in general and the strength of the local economies in which we conduct operations; fluctuations in interest rates and in real estate values; monetary and fiscal policies of the Board of Governors of the Federal Reserve System and the U.S. Government and other governmental initiatives affecting the financial services industry; the risks of lending and investing activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses; our ability to access cost-effective funding; the timely development of and acceptance of our new products and services and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors’ products and services; fluctuations in real estate values and both residential and commercial real estate markets, as well as agricultural business conditions; demand for loans and deposits in our market area; legislative or regulatory changes that adversely affect our business; changes in accounting principles, policies, or guidelines; results of examinations of us by our regulators, including the possibility that our regulators may, among other things, require us to increase our reserve for loan losses or to write-down assets; the impact of technological changes; and our success at managing the risks involved in the foregoing.

Any forward-looking statements are based upon management's beliefs and assumptions at the time they are made. We undertake no obligation to publicly update or revise any forward-looking statements or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise, except as may be required by law. In light of these risks, uncertainties and assumptions, the forward-looking statements discussed might not occur, and you should not put undue reliance on any forward-looking statements.

FAQ

What is the date of the Southern Missouri Bancorp and Citizens Bancshares merger?

The merger was completed on January 20, 2023.

What are the financial implications of the SMBC and Citizens Bancshares merger?

Southern Missouri paid approximately $131.4 million in total consideration for the merger, enhancing its financial stability.

How many banking facilities does Southern Missouri Bancorp operate after the merger?

After the merger, Southern Missouri Bancorp operates a total of 65 banking facilities.

What stock exchange is Southern Missouri Bancorp listed on?

Southern Missouri Bancorp is listed on NASDAQ under the ticker symbol SMBC.

What will each Citizens Bancshares shareholder receive from the merger?

Each shareholder will receive either 1.1755 shares of Southern Missouri stock or $54.93 in cash, depending on their election.