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Last updated 8:02AM ET
March 1, 2021
RBC Centura Will Buy Alabama National Bank
(APR - Alabama Public Radio ) - RBC Centura Banks Inc., a subsidiary of Royal Bank of Canada, said Thursday that it has agreed to acquire Alabama National BanCorporation in a deal valued at about $1.6 billion.

Raleigh-based RBC Centura said the deal will help the company in its ongoing expansion in the Southeast. Shareholders of Alabama National, based in Birmingham, will receive $80 in cash, RBC Centura shares or a combination of each under the agreement. That marks a 51 percent premium to Alabama National's closing stock from Wednesday.

Shares of Alabama National surged $23.89, or 45 percent, to close at $77.01.

"We are continuing to pursue investments that will grow our business in high growth markets and bring diverse service offerings and capabilities to new and existing customers," said Scott Custer, chairman and chief executive officer of RBC Centura, in a statement.

The deal marks RBC Centura's third acquisition in the past 13 months as it continues to develop a large footprint across the Southeast. The company announced last August its plans to purchase Atlanta-based Flag Financial Corp. in a $456 million deal. In March of this year, RBC Centura said it would acquire 39 branches in Alabama from AmSouth Bank.

Alabama National had $7.9 billion in assets as of June 30. It is the parent of 11 banks and financial businesses operating 111 offices in Alabama, Florida and Georgia.

The deal, to be completed early next year, will bring RBC Centura to a total of more than $33 billion in assets.

Alabama National CEO John Holcomb will become vice chairman of RBC Centura and remain based in Birmingham. Will Matthews, Alabama National's chief financial officer, will head specialty markets for RBC Centura.

Matthews declined comment Thursday on whether the deal will result in job cuts in Birmingham.

RBC Centura gained a foothold in Alabama less than a year ago when it purchased 39 AmSouth branches that were sold as part of the merger of Regions and AmSouth banks.

Jacob Jegher, a senior analyst at Boston-based financial research and consulting firm Celent, said RBC will likely continue to seek out acquisitions because the Canadian government has been blocking mergers of its domestic banks.

"RBC is basically cornered in Canada, so, to grow, it's got to attack things in the U.S.," Jegher said. "What RBC is looking at here is a long-term growth opportunity in a very competitive market environment in the U.S."

Alabama subsidiaries of Alabama National are First American Bank in north central Alabama; Alabama Exchange Bank in Tuskegee; and Bank of Dadeville. Florida subsidiaries are Indian River National Bank in Vero Beach; First Gulf Bank, N.A. in Escambia County, Fla., and Baldwin County, Ala.; Florida Choice Bank in Central Florida including metro Orlando; Community Bank of Naples, N.A.; Cypress Coquina Bank in Ormond Beach; and Millennium Bank in Gainesville. ANB has two subsidiaries in Georgia: Georgia State Bank and The Peachtree Bank, both in metropolitan Atlanta.

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