Provident New York Bancorp (NYSE: PBNY), announced on Wednesday that its Provident Bank subsidiary has entered into a definitive agreement to acquire Gotham Bank of New York (PINKSHEETS: GOBN) in a cash transaction valued at approximately $40.5 million. The closing consideration will be 125 percent of adjusted tangible net worth as calculated under the merger agreement, resulting in an estimated 3.3 percent core deposit premium. Completion of the transaction is subject to regulatory and Gotham Bank shareholder approvals and other customary closing conditions.
“Gotham Bank is a great strategic fit for us and offers an attractive platform in the New York City market to grow our franchise,” said Jack Kopnisky, President and CEO of Provident Bank. “The acquisition of Gotham Bank continues the implementation of our strategic objective to expand our reach into the greater New York City marketplace.”
Gotham Bank, chartered in 1980, operates as a community-oriented commercial bank through its branch in midtown Manhattan and emphasizes a high level of personal service for every client as a core business practice. As of September 30, 2011, it reported $169 million of loans and $335 million of deposits. It is conservatively managed with strong credit quality. “We are excited to join Provident Bank. This combination is a great outcome for our shareholders and employees as we share a commitment to providing our clients an unparalleled level of service. Provident Bank has a strong plan for the future and we are pleased to be an important part of their entry into New York City,” said Laurence R. Marchini Jr., Chief Executive Officer, Gotham Bank of New York.
Provident Bank previously announced the appointment of David S. Bagatelle as Executive Vice President of Provident Bank and President of the New York City market. In this role he will spearhead the expansion into New York City by focusing on serving middle market commercial clients as well as the personal banking needs of the owners, senior managers, and employees of those businesses. “As we put together our middle-market banking teams in New York City, Gotham provides a platform to expand that includes a core asset and deposit base, a long-term client base, an advantageous location in midtown Manhattan, and an initial legacy client relationship team,” said Mr. Bagatelle. “We plan to hire three to five New York City-based banking teams which will be teamed up with the legacy Gotham relationship team to create a strong middle-market franchise.”
The transaction, which has been approved by the boards of directors of both companies, is expected to close in the third quarter of 2012. This transaction will be accretive to earnings, excluding one-time transaction costs, in year one based on conservative cost savings estimates. In connection with the acquisition, Gotham Bank will merge into Provident Bank. Provident is the only bank currently headquartered in Rockland County.