EAGLE BANCORP MONTANA, INC. (EBMT) SPO
|Company Name||EAGLE BANCORP MONTANA, INC.|
|Company Address||1400 PROSPECT AVE.
P.O. BOX 4999
HELENA, MT 59604
|CEO||Peter J. Johnson|
|Employees (as of 12/31/2016)||200|
|State of Inc||DE|
|Fiscal Year End||12/31|
|Shares Over Alloted||0|
|Shareholder Shares Offered||--|
|Lockup Period (days)||180|
|Quiet Period Expiration||11/21/2017|
We estimate that the net proceeds to us from the offering, after deducting estimated underwriting discounts and commissions and estimated offering expenses, will be approximately $17.8 million, or approximately $20.1 million if the underwriters exercise their option to purchase additional shares from us in full. We intend to use the net proceeds from this offering for general corporate purposes, including potential future acquisitions and to support organic growth. We intend to contribute $10 million of the net proceeds from this offering to the Bank. Other than with respect to our pending acquisition of TwinCo, we currently do not have any immediate plans, arrangements or understandings regarding any future acquisitions. We do not need the proceeds from this offering to fund the acquisition of TwinCo. Our management will have broad discretion in the application of the net proceeds from this offering, and investors will be relying on the judgment of our management with regard to the use of these net proceeds. Pending the use of net proceeds from this offering as described above, we may invest the net proceeds in short-term liquid instruments.
We face strong competition in our primary market areas for retail deposits and the origination of loans. Historically, Montana was a unit banking state, which means that the ability of Montana state banks to create branches was either prohibited or significantly restricted. As a result of unit banking, Montana has a significant number of independent financial institutions serving a single community in a single location. While Montana’s population is approximately 1.04 million people, there are 51 credit unions in Montana as well as one national thrift institution and 49 commercial banks as of June 30, 2017. Our most direct competition for depositors historically has come from locally-owned and out-of-state commercial banks, thrift institutions and credit unions operating in our primary market areas. Competition in our primary market areas has increased in recent years. Our competition for loans also comes from banks, thrift institutions and credit unions, in addition to mortgage bankers and brokers.
We are a Delaware corporation that holds 100% of the capital stock of Opportunity Bank of Montana, which we refer to as the Bank or Opportunity Bank, formerly American Federal Savings Bank, or AFSB. The Bank was founded in 1922 as a Montana-chartered building and loan association and has conducted
operations and maintained its administrative office in Helena, Montana since that time. In 1975, the Bank adopted a federal thrift charter and in October 2014 converted to a Montana-chartered commercial bank. The Bank currently has 14 branch offices and 15 automated teller machines located in our market areas and we participate in the Money Pass® ATM network. In November 2012, we completed a significant transaction with Sterling Financial Corporation, or Sterling, of Spokane, Washington in which we purchased all of Sterling’s retail bank branches in Montana. As a result of this transaction, we added two mortgage origination offices and a wealth management division, and the Bank’s assets grew to over $500 million and the retail branch network grew from six to 13 full service branches immediately following the transaction, with six branches in new markets. In 2014, we applied to the State of Montana to form an interim bank for the purpose of facilitating the conversion of AFSB from a federally-chartered savings bank to a Montana-chartered commercial bank. Concurrent with the conversion, the Bank applied, and was approved, for membership in the Federal Reserve. In connection with the conversion, AFSB changed its name to Opportunity Bank of Montana. We provide loan and deposit services to customers who are predominantly small businesses and individuals throughout Montana. We are a diversified lender with a focus on residential mortgage loans, commercial real estate mortgage loans, commercial business loans and second mortgage/home equity loan products. In addition, we offer wealth management products and services through our wealth management division and financial consultants located in several of our markets. Our primary lines of business are: • Retail lending. We originate residential mortgage loans, home equity loans and consumer loans primarily through our community banking office network. We also offer our customers the choice of submitting online mortgage loan applications and receiving pre-approvals through our website. • Commercial Lending. We continue to place an emphasis on growing our commercial business and commercial real estate loan portfolios. In addition to commercial real estate loans, we offer traditional business loans structured as unsecured lines of credit or loans secured by inventory, accounts receivable or other business assets. We seek to provide exceptional service with local decision-making and personal attention. • Deposit Products and Services. We offer a full range of traditional deposit products such as checking accounts, savings accounts, money market accounts, retirement accounts, and certificates of deposit. These products can have additional features such as direct deposit, ATM and check card services, overdraft protection, telephone banking and Internet banking, which provide our customers multiple channels to access their accounts. • Mortgage Origination. We originate residential mortgage loans in all of our markets. The majority of these loans are sold in the secondary market with servicing retained, which is a significant source of noninterest income. • Mortgage Servicing. We provide loan servicing for other institutions. These services generally consist of collecting mortgage payments, maintaining escrow accounts, disbursing payments to investors and foreclosure processing. We are the sixth largest community bank headquartered in Montana with approximately $710.2 million in total assets, $508.1 million in gross loans and $514.3 million in total deposits as of June 30, 2017. --- Our principal executive and administrative office is located at 1400 Prospect Avenue, Helena, Montana 59601, and our telephone number is (406) 442-3080. Our website is www.opportunitybank.com.
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