Merger of Equals with Standard Bank
As the years go by, things may change, people look different as they age, your surroundings may be altered and updated, but one thing remains the same – you always know who your true friends are, you always know who you can count on, and you always keep that special trust with special people.
As you probably have heard, Allegheny Valley Bank has agreed to enter into a “merger of equals” with Standard Bank, based in Monroeville. This is an exciting time to for AVB and just as with those old friends whose appearance may have changed a bit over the years, we anticipate positive changes in the coming years while always remaining that community bank you’ve trusted all along.
This is a very good opportunity for our bank, our customers, our shareholders, and our employees. Think of it for a moment…
- A community bank with roughly double the size and scope of AVB, bringing a greater presence over an expanded geographic area.
- An opportunity to use this stronger presence to expand our products and services to our customers, provide significant capital to take care of the lending needs of our growing commercial customer base, and provide the resources to help meet our ever increasing regulatory burden.
- And a fresh opening to grow and thrive as a true community bank, even in this era of very tough mega bank competition.
A merger of equals involves the mutual decision of two companies to combine and become one entity. In our case, it can be seen as a decision made by two “equals” that are similarly situated. Both Standard Bank and AVB have nine branches, good earnings, strong asset quality and very strong capital. Here are some other financial measures to consider:
- Assets – Standard Bank = $485 million vs. AVB = $435 million
- Deposits – Standard Bank = $352 million vs. AVB = $322 million
- Loans - Standard Bank = $367 million vs. AVB = $291 million
- Equity - Standard Bank = $73 million vs. AVB = $51 million
A rash of bank mergers and acquisitions over the years has resulted in AVB remaining as one of the smallest independent stock owned banks in the greater Pittsburgh metropolitan market. As the competitive, economic, and regulatory pressures facing banks and, in particular, community banks continue to rise, achieving size and scale have become increasingly important. In order to more effectively compete and absorb the higher costs associated with delivering our products and services, we believed that merging with a company that shares our operating philosophy would enhance our ability to better serve our customers and communities while satisfying our shareholders without significant employee reductions and other cost cuts associated with a traditional sale.
I can say with absolute confidence and pride, that when this deal gets characterized as a “merger of equals,” it applies to more than just the financial statements of AVB and Standard. It also applies to the way we see our roles as the providers of needed banking services to neighbors, of capital to commercial and industrial enterprises, and of investment services to help provide our customers’ the expertise they need to manage their hard earned savings.
To Our Valued Customers: you can count on every AVB team member to bring our trademark spirit, that energy and enthusiasm that you have come to expect, to the job every day. We expect minimal customer impact.
We feel good about the future of our new enterprise, as we complete this merger of equals with Standard Bank, and know that the benefits to you will be rewarding. Some things may be changing, but the important things – like how we serve our community-based customers – will be just as strong as ever. Maybe even more so. Thanks for your business, and look for more information as this process moves along.
President & CEO