The merger of Entegra Bank and First Citizens Bank will make way for a new banking brand in Highlands.
On Monday, Dec. 2 the U.S. Department of Justice made a letter of agreement with First Citizens Bank public. In the letter, it noted that as part of the merger Entegra must divest three branches in Western North Carolina – one each in Highlands, Franklin and Sylva.
“Part of the merger process is the DOJ looking at the markets of both companies and reviewing what a merger will do in terms of competitiveness in those markets,” Entegra Bank CEO Roger Plemmons said. “Because we have a pretty large market overlap with First Citizens, the DOJ determined that a divestiture was necessary to keep some of the markets competitive in terms of banking business.”
The bank branches to be divested are located at 473 Carolina Way in Highlands, 30 Hyatt Road in Franklin and 498 East Main Street in Sylva.
“In Macon County specifically, Entegra has the largest market share already and if you were to add in the current First Citizens branches, that market share would certainly grow,” Plemmons said. “We knew as we got started with the merger process that a divestiture was a possibility.”
The branches must be sold to a competitor, meaning that a new bank will take over the space. While no potential suitors for the Entegra branch in Highlands have been announced, the process of selling the branch is expected to move quickly.
“There is no set timeline for when the divestiture will be completed, but it will take place before Entegra converts over to First Citizens systems,” Plemmons said. “I would imagine that the divestiture will happen some time in the spring of 2020.”
Adding another banking brand via the divestiture will bring another option to Highlands, where national banks PNC, Bank of America and Wells Fargo have each closed a branch in the past two years.
“First Citizens has a list of qualified competitors and it will be up to them to make it known that the divested branches are available,” Plemmons said. “At that point the branches will be sold to the highest bidder, assuming the potential purchaser is approved by DOJ regulators.”
The letter of agreement between First Citizens and the DOJ notes that First Citizens cannot reacquire any of the divested branches for a minimum of five years.
The letter also states that if First Citizens closes any of its branches, or any of the acquired Entegra Bank branches in Macon or Jackson counties, within three years of the merger being completed that those branches must also be sold or leased to another commercial bank.