Houston-based Third Coast Bancshares will acquire Austin, Texas-based Keystone Bank in a roughly $123 million deal set to close in the first quarter of 2026, the banks announced Wednesday.
The transaction will create a bank with more than $6 billion in assets and boost Third Coast’s presence in the Lone Star State’s capital, the bank said. Keystone counts two branches in the Austin market, along with a loan production office in Bastrop, 40 minutes east, and a branch in Ballinger, three hours northwest.
Bart Caraway, Third Coast’s CEO, said Keystone “perfectly complement[s] our Texas branch network.”
“Keystone is a highly respected financial institution that shares our core values of exceptional customer service and building lasting relationships within the communities we serve,” Caraway said in a statement Wednesday. “Together, we will create significant benefits for our customers, driving innovation and operational excellence.”
Keystone CEO Jeff Wilkinson, meanwhile, said the banks are “united by a common vision, shared values, and a commitment to exceptional customer service, innovation and community focus.”
“By combining our resources and expertise, we are poised to deliver premier banking solutions, cutting-edge technology and convenience with a personal touch and community-oriented banking services, while fostering future growth throughout greater Austin."
Texas has been one of the most targeted states for bank M&A activity this year. In the large-bank space, that’s been reflected in Fifth Third’s $10.9 billion proposed acquisition this month of Dallas-based Comerica.
Fifth Third’s Ohio rival Huntington also made advances on the Dallas-Fort Worth market, buying Dallas-based Veritex Holdings for $1.9 billion.
Additionally, Kalispell, Montana-based Glacier Bank is acquiring Mount Pleasant-based Guaranty Bancorp in a $476.2 million deal. Denver-based National Bank Holdings is buying Dallas-based Vista Bancshares for $369.1 million. And Houston-based Prosperity Bancshares said it would acquire San Antonio-based Southwest Bancshares for $268.9 million.
More recently, Houston-based Cornerstone Capital Bancorp said last week it would acquire Peoples Bancorp for an undisclosed sum.
Under Wednesday’s deal, Keystone investors will receive either 0.45925 shares of Third Coast common stock for each share they own, or cash equal to 0.45925 times the volume-weighted average price per share of Third Coast common stock for a pre-set 20-trading-day period. But the total cash consideration won’t exceed $20 million, Third Coast said.
The transaction’s value is based on Third Coast’s closing stock price of $39.17 per share from Tuesday, and assumes an outcome of $17.99 per Keystone share, Third Coast said.
But the exchange ratio may adjust downward if Keystone shareholders' equity is less than $94,576,000, Third Coast said.
