NC’s Fidelity Bank to get Atlanta foothold with $142.8M Affinity deal

Dive Brief:

North Carolina-based Fidelity Bank will acquire Covington, Georgia-based Affinity Bank in a $142.8 million-asset deal that’s expected to close in the third quarter, the companies said Monday.
The transaction would give Fidelity a brick-and-mortar presence in Georgia for the first time and allow it to access the Atlanta market.
The acquisition also provides a landing spot for Affinity, which agreed in May 2024 to be acquired by Atlanta Postal Credit Union. The deal was terminated seven months later after discussions between APCU and regulators, the bank and credit union said.

Dive Insight:

Buying $882 million-asset Affinity will give Fidelity two branches in Georgia – including one in Atlanta – to bolster its 55-location footprint that stretches from Virginia to South Carolina. It will also push Fuquay-Varina, North Carolina-based Fidelity past the $5 billion threshold, creating an institution with $5.5 billion in assets, $4.6 billion in deposits and $3.6 billion in loans, the banks said.

“This partnership brings together two community-focused organizations that share a strong commitment to relationship-driven banking and putting people first,” Fidelity CEO Mary Willis said in a statement. “We look forward to building on Affinity Bank’s strong local reputation while continuing to serve customers and communities with the same personal attention and care they know and trust.”

Under the agreement, Affinity investors will receive $23 in cash for each share they own. A spike in Affinity’s stock price, however, may be eating into the deal’s premium. Affinity stock traded at $19.60 per share at market close Monday, before the deal was announced. But Tuesday, the bank’s per-share value jumped to $22.47, according to Yahoo Finance.

“Fidelity Bank and Affinity Bank share tremendous cultures built over many years of service to our respective customers, employees and communities,” Affinity CEO Ed Cooney said Monday. “Our partnership will enhance Affinity Bank’s capabilities and suite of services which will benefit customers as we continue to expand our Georgia presence.”

Buying Affinity may help Fidelity drill down on the commercial side – particularly in real estate, construction, and lending to medical and dental practices.

Affinity, meanwhile, may benefit from Fidelity’s footprint in wealth management and mortgage and government-guaranteed lending.

Atlanta has long been a coveted market for banks looking to expand. First Community Corp. acquired Sandy Springs-based Signature Bank of Georgia in a deal announced last July that put the South Carolina-headquartered lender in the Atlanta area for the first time.

Likewise, banking behemoths are not immune to Atlanta’s allure. The city ranked as one of several target markets – along with Philadelphia, Los Angeles and San Francisco and Alabama – where JPMorgan Chase indicated Tuesday that it would bulk up commercial-banking hires as part of a 10-year initiative to bolster lending to small businesses.