Bank7 in Oklahoma City has agreed to buy Watonga Bancshares in Watonga, Okla.
The $1.2 billion-asset Bank7 said in a press release Thursday that it will pay $32 million in cash for the parent of the $241 million-asset Cornerstone Bank. The deal, which is expected to close in the fourth quarter, valued Watonga at 141% of its tangible book value.
The deal is expected to be 7.3% accretive to Bank7’s 2022 earnings per share. It should take Bank7 three years to earn back any dilution to its tangible book value.
Bank7 plans to cut 40% of Cornerstone’s annual noninterest expenses, or $2.6 million. It expects to incur $900,000 of merger-related expenses.
Bank7 was advised by Keefe, Bruyette & Woods and Paul Foster Law Offices. Cornerstone was advised by D.A. Davidson and McAfee & Taft.