Bridgewater Bancshares in St. Louis Park, Minn., has agreed to buy First Minnetonka City Bank in Minnetonka, Minn.
The $3.7 billion-asset Bridgewater said in a press release that it will pay cash for the $242 million-asset First Minnetonka City Bank. The deal is expected to close in the fourth quarter.
First Minnetonka City Bank has two branches, $212 million of deposits and $128 million of loans.
“We are very pleased to add a high-quality and complementary Twin Cities community bank through a transaction that aligns with and accelerates our strategic priorities,” Jerry Baack, Bridgewater’s chairman and CEO, said in the release.
“First Minnetonka City Bank brings a granular core deposit base that creates balance sheet optionality and a loan mix that increases the diversification of our loan portfolio,” Baack added. “The bank’s investment advisory platform will allow us to offer a more complete product set to our client base.”
The deal should be 15% accretive to Bridgewater’s 2025 earnings per share. It should take less than three years for Bridgewater to earn back an estimated 5% dilution to its tangible book value.
Bridgewater plans to cut half of First Minnetonka City Bank’s annual noninterest expenses. It expects to incur $2.7 million of pretax merger-related expenses.
D.A. Davidson and Barack Ferrazzano Kirschbaum & Nagelberg advised Bridgewater. Olsen Palmer and Winthrop & Weinstine advised First Minnetonka City Bank.