The merged entity will serve customers through a network of 79 branches. Credit: Gerd Altmann from Pixabay.

Louisville, Kentucky-based Stock Yards Bancorp, the parent of Stock Yards Bank & Trust Company, is expanding its local presence with the acquisition of Commonwealth Bancshares in a stock-cash deal worth around $153m.

Commonwealth Bancshares, also based in Louisville, is the parent of Commonwealth Bank & Trust.

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The merged entity will serve customers through a network of 79 branches.

It will have total assets of around $7.4bn, $4.9bn in gross loans, $6.4bn in deposits and $7bn in trust assets under management.

The deal awaits regulatory nod, with completion expected in the fourth quarter of this year.

Commonwealth has a total of 16 retail branches, including ten branches in Jefferson County, four in Shelby County and two in Northern Kentucky.

At the end of June 2021, the bank had approximately $1.3bn in assets, $733m in loans, $1.1 bn in deposits and $86m in tangible common equity.

Commonwealth also operates a Wealth Management and Trust Department, which managed assets of $2.6bn as of 30 June 2021.

Stock Yards chairman and CEO James Hillebrand said: “This combination brings together two local community banks based in Louisville, who are very like-minded with similar cultures.

“The transaction builds upon our market share in the Louisville market, as Commonwealth is the largest privately-held bank headquartered in the Louisville MSA, while also expanding our presence in Shelby County and Northern Kentucky.

“Additionally, and just as important, this combination significantly bolsters our wealth management capabilities, adding $2.6bn in wealth and trust assets, and making Stock Yards the largest bank-owned Trust company in the state.”

Commenting on the deal, Commonwealth president and CEO John Key said: “Both banks have always been focused on providing great customer service, a strong commitment to the communities where they operate and an excellent environment for employees to perform and advance.

“We look forward to working with the management team at Stock Yards to create the leading community bank in the region.”

As part of the deal, Commonwealth board of directors’ member Laura Wells will join the Stock Yards board.

Earlier this year, Stock Yards concluded its $190m purchase of Kentucky Bancshares.

Consolidation activities in the community banking space have been rampant so far this year.

Last month, Citizens Financial Group agreed to acquire Investors Bancorp for $3.5bn. United Community Banks agreed to buy Reliant Bancorp and its subsidiary Reliant Bank for nearly $517m in the same month.