8-KOther EventsExhibits & Filings

FIRST CITIZENS BANCSHARES INC /DE/ 8-K Report, Corporate Update (Aug 28, 2013)

Filed August 28, 2013For Securities:FCNCAFCNCPFCNCBFCNCOFCNCN

Summary

First Citizens BancShares, Inc. (FCNCA) announced on August 28, 2013, a definitive merger agreement between its bank subsidiary, First-Citizens Bank & Trust Company (FCB), and 1st Financial Services Corporation. This transaction will see 1st Financial and its bank subsidiary, Mountain 1st Bank & Trust Company, merged into FCB. The deal has received board approvals and is anticipated to close by the first quarter of 2014, pending regulatory and shareholder approvals. The primary financial aspect of this merger involves a $10 million cash consideration. Notably, $8.0 million of this amount will be paid to the U.S. Treasury to facilitate 1st Financial's exit from the federal TARP program. The remaining $2 million will be distributed to 1st Financial's common shareholders. This transaction represents a strategic move for First Citizens BancShares, integrating a smaller entity and addressing the exit of the acquired company from a government program.

Key Highlights

  • 1First Citizens BancShares, Inc. (FCNCA) has entered into a definitive merger agreement for its subsidiary, First-Citizens Bank & Trust Company (FCB), to merge with 1st Financial Services Corporation.
  • 21st Financial and its bank subsidiary, Mountain 1st Bank & Trust Company, will be merged into FCB.
  • 3The transaction has received approval from the Boards of Directors of the involved entities.
  • 4The merger is expected to be completed by the first quarter of 2014, subject to regulatory and shareholder approvals.
  • 5A total of $10 million in cash consideration will be paid.
  • 6A significant portion, $8.0 million, is allocated to the U.S. Treasury for 1st Financial's exit from the federal TARP program.
  • 7The remaining $2.0 million of cash consideration will be distributed to 1st Financial's common shareholders.

Frequently Asked Questions

The primary purpose for 1st Financial is to exit the federal TARP (Troubled Asset Relief Program) program, facilitated by the cash consideration paid to the U.S. Treasury as part of the merger agreement.

The financial impact on First Citizens BancShares is the acquisition of 1st Financial and its subsidiary, Mountain 1st Bank & Trust Company. The company is paying $10 million in cash, with the majority going to the U.S. Treasury to facilitate the transaction and a smaller portion to 1st Financial's shareholders. This expands First Citizens' asset base and market presence.

The merger is expected to close no later than the first quarter of 2014, provided that all necessary regulatory approvals, shareholder approvals for 1st Financial, and other customary closing conditions are met.

1st Financial's common shareholders will receive $2 million in cash consideration as part of the merger agreement.