Provident Financial Services, Inc. (NYSE:PFS) (“Provident”), the
parent company of Provident Bank, and Lakeland Bancorp, Inc.
(Nasdaq: LBAI) (“Lakeland”), the parent company of Lakeland Bank,
today announced receipt of regulatory approvals from the Federal
Deposit Insurance Corporation and the New Jersey Department of
Banking and Insurance for Provident and Lakeland to complete their
previously announced merger. With these approvals, the only pending
regulatory approval required to complete the merger is the approval
of the Board of Governors of the Federal Reserve System.
Upon completion of the merger, the combined company will operate
under the Provident name and will benefit from enhanced scale, and
opportunities for growth and profitability. Provident’s and
Lakeland’s complementary strengths will provide exceptional service
to customers and communities served.
“We are very pleased to be closer to combining our two great
banks to create a top-tier super-community bank. This merger will
afford us greater opportunity to serve the financial needs of our
customers and communities, and to continue to expand and grow our
product offerings,” said Anthony Labozzetta, President and CEO of
Provident Bank. “The combination of our two organizations gives me
great pride as we bring together top talent and leadership under
one team,” said Thomas J. Shara, Lakeland’s President and CEO.
The regulatory approvals contain certain conditions and
commitments, including that Provident complete a $200 million
capital raise prior to completion of the merger. Provident intends
to satisfy this condition by raising $200 million of Tier 2
qualifying subordinated debt prior to completing the merger.
Further, for a period of three years following completion of the
merger, Provident Bank will be required to maintain a Tier 1
capital to total assets leverage ratio of at least 8.5% and a total
capital to risk-based assets ratio of at least 11.25%. In addition,
Provident Bank will maintain its ratio of commercial real estate
loans to total capital and reserves at or below the levels set
forth in the three-year projections supporting its regulatory
applications. Provident Bank will also be obligated to develop an
action plan, subject to FDIC approval, to improve home mortgage
applications from and originations to all demographic populations
within the combined bank’s reasonably expected market area. In
connection with these approvals, Provident and Lakeland expect to
agree that the combined board of directors will consist of nine
directors from Provident and five directors from Lakeland.
The two companies also expect to extend their merger agreement
to June 30, 2024, to provide time to receive the remaining
regulatory approval and to complete the subordinated debt
issuance.
The merger is expected to be completed in the second calendar
quarter, subject to the receipt of approval for the merger from the
Board of Governors of the Federal Reserve System, completion of the
debt issuance and satisfaction of customary closing conditions.
About Provident
Provident Financial Services, Inc. is the holding company for
Provident Bank, a community-oriented bank offering “commitment you
can count on” since 1839. Provident Bank provides a comprehensive
array of financial products and services through its network of
branches throughout northern and central New Jersey, Bucks, Lehigh
and Northampton counties in Pennsylvania, as well as Queens and
Nassau Counties in New York. The Bank also provides fiduciary and
wealth management services through its wholly owned subsidiary,
Beacon Trust Company and insurance services through its wholly
owned subsidiary, Provident Protection Plus, Inc.
About Lakeland
Lakeland Bank is the wholly-owned subsidiary of Lakeland
Bancorp, Inc., which had $11.14 billion in total assets at December
31, 2023. With an extensive branch network and commercial lending
centers throughout New Jersey and Highland Mills, New York, the
Bank offers business and retail banking products and services.
Business services include commercial loans and lines of credit,
commercial real estate loans, loans for healthcare services,
asset-based lending, equipment financing, small business loans and
lines and cash management services. Consumer services include
online and mobile banking, home equity loans and lines, mortgage
options and wealth management solutions. Lakeland is proud to be
recognized as New Jersey’s Best-In-State Bank by Forbes and
Statista for the fifth consecutive year, Best Banks to Work For by
American Banker, rated a 5-Star Bank by Bauer Financial and named
one of New Jersey’s 50 Fastest Growing Companies by NJBIZ.
Additional Information About the Subordinated Debt
Issuance
It is expected that the subordinated debt to be offered will be
issued pursuant to a prospectus supplement and an accompanying base
prospectus filed as part of Provident’s effective shelf
registration statement on Form S-3 (File No. 333- 275213).
Before considering an investment, investors should read the
prospectus in that registration statement and other documents
filed, or to be filed, with the Securities and Exchange Commission
(the “SEC”) for more complete information about the issuer and the
offering. A copy of the prospectus, and when available, the
prospectus supplement, are available without charge by visiting
EDGAR on the SEC Web site at www.sec.gov. Alternatively, a
copy of the prospectus, and when available, the prospectus
supplement, may be requested by calling Provident at 732-590-9300
or by contacting: Piper Sandler & Co. by telephone at
(866) 805-4128 or by email at fsgsyndicate@psc.com, or by emailing
Keefe, Bruyette & Woods at USCapitalMarkets@kbw.com.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of the
subordinated debt, in any state or jurisdiction in which such
offer, solicitation or sale would be unlawful.
Forward Looking Statements
This press release includes “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended,
with respect to Provident’s and Lakeland’s beliefs, goals,
intentions, and expectations regarding the proposed transaction,
revenues, earnings, earnings per share, loan production, asset
quality, and capital levels, among other matters; our estimates of
future costs and benefits of the actions we may take; our
assessments of probable losses on loans; our assessments of
interest rate and other market risks; our ability to achieve our
financial and other strategic goals; the expected timing of
completion of the raising of $200 million of Tier 2 qualifying
subordinated debt (the “Offering”) and the proposed transaction;
the expected cost savings, synergies and other anticipated benefits
from the proposed transaction; and other statements that are not
historical facts.
Forward‐looking statements are typically identified by such
words as “believe,” “expect,” “anticipate,” “intend,” “outlook,”
“estimate,” “forecast,” “project,” “should,” and other similar
words and expressions, and are subject to numerous assumptions,
risks, and uncertainties, which change over time. These
forward-looking statements include, without limitation, those
relating to the terms, timing and closing of the Offering and the
proposed transaction.
Additionally, forward‐looking statements speak only as of the
date they are made; Provident and Lakeland do not assume any duty,
and do not undertake, to update such forward‐looking statements,
whether written or oral, that may be made from time to time,
whether as a result of new information, future events or otherwise.
Furthermore, because forward‐looking statements are subject to
assumptions and uncertainties, actual results or future events
could differ, possibly materially, from those indicated in such
forward-looking statements as a result of a variety of factors,
many of which are beyond the control of Provident and Lakeland.
Such statements are based upon the current beliefs and expectations
of the management of Provident and Lakeland and are subject to
significant risks and uncertainties outside of the control of the
parties. Caution should be exercised against placing undue reliance
on forward-looking statements. The factors that could cause actual
results to differ materially include the following: the occurrence
of any event, change or other circumstances that could give rise to
the right of one or both of the parties to terminate the Merger
Agreement; the outcome of any legal proceedings that may be
instituted against Provident or Lakeland; the possibility that the
proposed transaction will not close when expected or at all because
required regulatory or other approvals are not received, the
Offering is not completed on a timely basis or at all or other
conditions to the closing are not satisfied on a timely basis or at
all, or regulatory or other approvals are obtained subject to
conditions that are not anticipated (and the risk that required
regulatory approvals may result in the imposition of conditions
that could adversely affect the combined company or the expected
benefits of the proposed transaction); the ability of Provident and
Lakeland to meet expectations regarding the timing, completion and
accounting and tax treatments of the proposed transaction; the risk
that any announcements relating to the Offering or the proposed
transaction could have adverse effects on the market price of the
common stock of either or both parties to the proposed transaction;
the possibility that any condition imposed or commitment entered
into in connection with regulatory approvals for the proposed
transaction cannot be satisfied; the possibility that the
anticipated benefits of the proposed transaction will not be
realized when expected or at all, including as a result of the
impact of, or problems arising from, the integration of the two
companies or as a result of the strength of the economy and
competitive factors in the areas where Provident and Lakeland do
business; certain restrictions during the pendency of the proposed
transaction that may impact the parties’ ability to pursue certain
business opportunities or strategic transactions; the possibility
that the transaction may be more expensive to complete than
anticipated, including as a result of unexpected factors or events;
diversion of management’s attention from ongoing business
operations and opportunities; the possibility that the parties may
be unable to achieve expected synergies and operating efficiencies
in the merger within the expected timeframes or at all and to
successfully integrate Lakeland’s operations and those of
Provident; such integration may be more difficult, time consuming
or costly than expected; revenues following the proposed
transaction may be lower than expected; Provident’s and Lakeland’s
success in executing their respective business plans and strategies
and managing the risks involved in the foregoing; the dilution
caused by Provident’s issuance of additional shares of its capital
stock in connection with the proposed transaction; effects of the
announcement, pendency or completion of the proposed transaction on
the ability of Provident and Lakeland to retain customers and
retain and hire key personnel and maintain relationships with their
suppliers, and on their operating results and businesses generally;
the ability of Provident to complete the Offering on expected terms
or at all; and risks related to the potential impact of general
economic, political and market factors on the companies, the
Offering or the proposed transaction and other factors that may
affect future results of Provident and Lakeland; uncertainty as to
the impacts of natural disasters or health epidemics on Provident,
Lakeland and the proposed transaction; and the other factors
discussed in the “Risk Factors” section of each of Provident’s and
Lakeland’s Annual Report on Form 10‐K for the year ended December
31, 2023, and in other reports Provident and Lakeland file with the
SEC.
Provident Financial Services, Inc.
Investor Relations Contact:Thomas LyonsSEVP
& Chief Financial Officer(732) 590-9348
Lakeland Bancorp, Inc.
Investor Relations Contacts:Thomas J.
SharaPresident & Chief Executive Officer(973) 697-2000
Thomas F. SplaineEVP & Chief Financial
Officer(973) 697-2000
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