Quakertown, Pennsylvania-based QNB Corp. is buying Victory Bancorp, a smaller in-state peer, in a $40.97 million deal, the bank holding company announced Tuesday.
The acquisition, expected to close as soon as the fourth quarter, will create a company with roughly $2.4 billion in assets with a combined market capitalization of $173 million, QNB said.
The deal’s value is based on QNB’s closing stock price of $25.60 from Monday, putting the price per share for Victory common stock at $19.58. Under the agreement, Victory shareholders would receive half a share of QNB common stock for each Victory share they own.
“The combination will result in a strong, well-diversified bank, positioning us to accelerate growth,” QNB CEO Dave Freeman said in a prepared statement. “The close alignment between our leadership teams and boards will help us surpass customer expectations as we support them in reaching their financial goals.”
Freeman is expected to remain in his role at the combined company.
QNB expects the transaction to be accretive, by roughly 16% earnings per share in 2026 and 19% earnings per share in 2027. QNB expects to earn back the deal’s book value in less than 3.3 years.
For Victory, the deal is expected to be more than 35% accretive to its projected 2026 earnings per share. QNB’s projected annual cash dividend is expected to give Victory shareholders more than double what they’d receive from their own annual cash dividend.
The combined bank will operate under the QNB moniker. QNB’s board of directors will expand from 10 directors to 12, with two newly appointed from Victory. Joe Major, who will join the board from Victory, will serve as QNB vice chair.
“Beyond just this transaction, this partnership represents an exciting opportunity to build one of the most dynamic and growth-oriented community bank franchises in all of Pennsylvania,” Major said in a prepared statement. “I have known Dave and his outstanding team for many years, and look forward to collaborating with them to make this partnership a success.”
The banking sector has continued to see an uptick in M&A as a result of policy shifts under the Trump administration. More than 100 U.S. bank deals had been announced this year as of Aug. 12, with 26 in July alone, according to S&P Global Market Intelligence. That’s the highest monthly tally since June 2021, the firm said.
