First Century Bancorp in Roswell, Ga., has terminated its merger agreement with First Internet Bancorp in Fishers, Ind.
The $4.2 billion-asset First Internet said in a press release Sunday that the $408 million-asset First Century called off the deal. The proposed transaction, announced on Nov. 2, was supposed to be completed by April 30.
First Internet said that, while the Federal Reserve approved its purchase of First Century on Friday, the companies were precluded to closing immediately due to “statutory waiting periods” and were unable to negotiate an extension.
“Despite efforts to negotiate, we could not arrive at a mutually agreeable increased purchase price in exchange for an extension,” David Becker, First Internet’s chairman and CEO, said in the release.
“While the acquisition initially appeared to provide opportunities to diversify our revenue streams, we will not support excess deployment of capital without a clear and likely pathway to an acceptable payback,” Becker added. “Even as we worked diligently on integration with First Century, we continued to source and evaluate additional strategic opportunities and have built a pipeline of actionable projects to drive results higher in future periods.”
First Internet had agreed to buy the deposit-rich First Century for $80 million in cash. The deal had priced First Century at 135% of its tangible book value.
First Century is a technology-driven bank that focuses on payments, tax product lending, sponsored card programs and homeowners association services.