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F.N.B. Corporation (FNB - Snapshot Report) is moving forward with its strategy to grow through acquisitions. The company announced a deal to acquire Baltimore-based BCSB Bancorp, Inc. and its subsidiary Baltimore County Savings Bank in an all-stock transaction.

FNB stated that the deal is valued at about $79 million. Moreover, under the terms of the agreement, shareholders of BCSB Bancorp will receive 2.08 shares of FNB for each share of BCSB Bancorp.
The transaction is expected to be complete in the first quarter of 2014. Further, while the board of directors of both the companies has approved it, the deal is still subject to regulatory approvals and the consent of BCSB Bancorp’s shareholders.

The transaction will significantly enhance FNB’s presence in Baltimore metropolitan statistical area with the addition of BCSB Bancorp’s 16 banking offices. Moreover, upon completion, FNB would be receiving BCSB Bancorp’s total deposits worth about $560 million and $320 million of loans. Moreover, the deal will be marginally accretive to the company’s earnings (excluding one-time transaction cost of nearly $16.4 million) in the first full year, while having a neutral impact on its tangible book value per share.

Over the last couple of years, FNB has been on an acquisition spree. In Apr 2013, the company closed an all-stock deal to buy Annapolis Bancorp Inc. for about $51 million.

Earlier in February this year, FNB announced an all-stock deal to buy Ohio-based PVF Capital Corp. for about $106.4 million. In Jan 2012, the company completed the acquisition of Parkvale Financial Corporation, while in Jan 2011 it acquired Comm Bancorp, Inc.

We believe that FNB will continue with its strategy to expand through acquisitions. The company’s stable capital position and strong balance sheet will support its growth plan in the future.

Currently, FNB carries a Zacks Rank #3 (Hold). However, other Southeast banks such as Ameris Bancorp (ABCB - Snapshot Report) with a Zacks Rank #1 (Strong Buy) are more favorably placed.

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