Old Second Bancorp to purchase five Illinois branches from First Merchants

Old Second Bancorp (OSBC) and First Merchants Corporation (FRME) jointly announced that Old Second and First Merchants have entered into a Purchase and Assumption Agreement where Old Second will purchase 5 Illinois branch locations in the Southeast Chicago MSA as well as certain branch related loans and deposits from First Merchants. The acquisition enhances Old Second’s position as one of the largest banks headquartered in Chicago and adds meaningfully to its existing branch network and in the Southeast Chicago market, allowing for improved scale and penetration. The sale by First Merchants completes its branch exit from suburban Chicago markets. Old Second anticipates assuming approximately $304 million in deposits and purchasing approximately $12 million in branch-related loans from this acquisition. Old Second will pay a deposit premium of 7.5%, or approximately $23 million, in estimated cash consideration to First Merchants. The branches to be acquired by Old Second will operate as First Merchants branches until closing and will be re-branded as Old Second branches immediately upon closing of the transaction. Pending regulatory approval, the closing is expected to occur near year-end 2024.