Stock Yards bulking up in asset management with bank deal

Stock Yards Bancorp in Louisville, Ky., has agreed to buy Commonwealth Bancshares in Louisville. 

The $6.1 billion-asset Stock Yards said in a press release Tuesday that it will pay $153 million in cash and stock for the $1.3 billion-asset Commonwealth. The deal is expected to close in the fourth quarter.

Commonwealth has 16 branches, $733 million of loans and $1.1 billion of deposits. The company also has a wealth management and trust department with $2.6 billion of assets under management.

The deal is expected to be 12% accretive to Stock Yards’ 2023 earnings per share. It should take less than two years for Stock Yards to earn back any dilution to its tangible book value.

The acquisition “brings together two local community banks … who are very like-minded with similar cultures,” Ja Hillebrand, Stock Yards’ chairman and CEO, said in the release.

“The transaction builds upon our market share in the Louisville market … while also expanding our presence in Shelby County and northern Kentucky,” Hillebrand added. “This combination significantly bolsters our wealth management capabilities … making Stock Yards the largest bank-owned trust company in the state.”

Laura Wells, a Commonwealth director, will join Stock Yards’ board.

Stephens and Frost Brown Todd advised Stock Yards. Keefe and Squire Patton Boggs advised Commonwealth.