THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Tuesday, September 17, 1996 TAG: 9609170425
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY TOM SHEAN, STAFF WRITER
LENGTH: 40 lines
In its latest pursuit of banking business in Maryland, Crestar Financial Corp. said Monday it agreed to buy Citizens Bancorp, a Laurel, Md., bank holding company with $3.1 billion of deposits and $2.3 billion of loans.
Crestar, based in Richmond, said it will have the largest share of bank deposits in the Washington area and the second-largest share in Maryland after completing the transaction with Citizens. The deal, due to be completed by next March 31, will boost its total assets by 23 percent to $22.7 billion, Crestar said.
Crestar has a regional office in downtown Norfolk and more than 50 branches in Hampton Roads.
It agreed to acquire Citizens through an exchange of 0.835 of a Crestar share for each of Citizens' 15.1 million shares. At Monday's closing price of $59.125 for Crestar's common stock, the deal is worth $745 million.
``This is another move to solidify our presence in the greater Washington area and Maryland,'' said Barry Koling, a Crestar spokesman. ``These are great places to be because of the residents' incomes, education and their demand for banking services.''
In late 1995, Crestar acquired a large Baltimore-based thrift, Loyola Federal Savings Bank. Earlier this year, it purchased deposits and branches of Chase Manhattan Bank of Maryland and Mellon Bank of Maryland.
Crestar said the Citizens transaction will provide it with added deposits from 220,000 households and loans from 91,000 households. Citizens has 103 branches, but some of these overlap with existing Crestar offices and will likely be closed, Crestar said.
The transaction still must be approved by banking regulators.
In reaction to news of the merger agreement, Crestar's shares declined $2.25 to $59.125 for the day, while Citizens' shares soared $14.75 to $47 a share.
Crestar and Citizens also said Monday that they had called off stock repurchase programs that each company had announced earlier this year. by CNB