CenterState 1st National Bank of South Florida

For the second time this month, CenterState Banks has unveiled a deal that will push it further into South Florida.

CenterState (NASDAQ: CSFL), based in Davenport, has an agreement to buy Hometown of Homestead Banking Co. for $19.1 million.

Hometown of Homestead is the parent company of 1st National Bank of South Florida, a $346 million-asset bank based in Homestead and with six offices in south Miami-Dade County. The price equates to 110 percent of tangible book value, according to Raymond James Equity Research.

Founded in 1932 as the First National Bank of Homestead, it is the second-oldest bank in South Florida. It changed its name to 1st National Bank of South Florida in 2001. The bank had $202 million in loans and $283 million in deposits as of June 30. It earned $953,000 in the first half of 2015.

The deal builds on CenterState’s planned acquisition of Homestead-based Community Bank of South Florida, announced earlier this month.

“The combination of the two acquisitions helps us to further penetrate the attractive south Miami-Dade market,” Executive Chairman Ernie Pinner said in a news release.

That means Homestead will go from having two locally based banks to none.

When the deals close, CenterState will have $4.7 billion in assets, $3.1 billion in loans and $3.9 billion in deposits. It will have about $1.2 billion in deposits in the Miami metropolitan area alone, an investor presentation said. About two-thirds of the 74 offices it will have after the deals close are along the Interstate 4 corridor between Tampa and Orlando, or north of I-4, with a growing number along the southeast coast of Florida and in South Florida.

The transaction is the most recent in a wave of consolidation among Florida community banks.
Small banks have struggled to make money in a low interest rate environment, and many management teams and boards of directors are looking for liquidity on their investments. But community banks are a major source of credit for small and midsize businesses and, as they consolidate, there are fewer options for companies that need to borrow money.

CenterState, the second-largest Florida-based bank with assets under $20 billion, posted net income of $9.9 million, or 22 cents a share, for the third quarter of 2015, compared to net income of $9.87 million, or 21 cents a share, in the year-ago period, it announced separately.

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