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SCBT-First Financial merger to create $5B bank in S.C.

Staff Report
Published Feb. 20, 2013

The merger of Columbia-based SCBT Financial Corp. and First Financial Holdings Inc. of Charleston, announced today, would create the state’s fifth-largest bank with more than $5 billion in deposits and 115 branches in South Carolina.

Throughout its system in South Carolina, North Carolina and Georgia, the new bank will have $6.9 billion in deposits and 148 branches.

The merger also links one of the dominant regional banks along the coast with another rooted in the Midlands with a growing presence along the Interstate 85 corridor between Charlotte and Atlanta.

“This transaction for both companies has a lot more to do with the next 10 years than about the next 10 months,” said Robert Hill Jr., president and CEO of SCBT. “It’s really about building a platform that puts us in place to build a dominant Southeastern bank in a changing banking landscape.”

Wayne Hall, president and CEO of First Financial, said the merger is a natural fit of two companies with similar cultures and complementary strengths.

“We believe it’s going to create a dominant Southeast institution, one that we believe we will be able to leverage our power, our capital and the synergies around,” Hall said.

The two companies, founded in the depths of the Great Depression some 80 years ago, have been talking about a possible merger since 2009, Hill said.

“Either it was not the right time for one company or the other,” Hill said.

But now, after both companies have rapidly expanded through a series of acquisitions of smaller banks, the timing is right to put together a merger, Hill said.

The merger probably will close sometime in the third quarter of this year, but Hill said that it might be the later part of 2014 before the merger is complete.

One of the first decisions of the merger was to change the name of SCBT Financial, the holding company for South Carolina Bank & Trust, to First Financial Holdings.

Hall will be president of the holding company and Paula Harper Bethea, the current chair of First Financial, will assume the role of vice chair of the board.

Hill will serve as CEO and Robert Horger will remain board chairman. Five First Financial board members will join the combined board of directors.

One decision that needs to be made before the transition is completed is picking a name for the banks. SCBT presently has five different brands of banks in South Carolina, North Carolina and Georgia.

Some of the traits that the companies share include operating under a community banking model and strong service levels. Both have mortgage, wealth management, retail and commercial business.

Through the merger, the companies will vault to No. 1 in terms of market share in Hilton Head Island and Georgetown. Combined, they’ll be No. 2 in Charleston, No. 4 in Florence, No. 5 in Greenville and No. 6 in Myrtle Beach.

Founded in 1934, First Financial operates First Federal Bank, which has 66 locations in the Carolinas and ranks eighth in deposit market share.

Upon completion of the transaction, the combined company will have approximately $8.3 billion in total assets, $6.9 billion in total deposits and $6.1 billion in total loans. The new company will generate more than $2 billion in mortgage loans, ranking fourth in mortgage market share.

First Financial’s wealth management division when combined with SCBT’s wealth management group will have total assets under management of approximately $2.35 billion.

The companies have about 2,200 employees.

Under the terms of the agreement, shareholders of First Financial will receive 0.4237 shares of SCBT common stock for each share of First Financial common stock, which equates to a deal value of $18.30 per share based on SCBT’s closing stock price of $43.18 on Feb. 19. The stock issuance is valued at approximately $302.4 million.

Previous coverage

SCBT Financial, First Financial to merge
SCBT reports 23% jump in Q4 income
SCBT Financial completes takeover of Savannah Bancorp
Acquisition gives SCBT opportunity to expand wealth management group
SCBT rebrands Peoples Bancorp. offices
First Financial reverses year-end loss
Treasury Department to sell stock in Charleston-based bank