South Carolina based Community First Bank acquires Security Federal
Three local bank executives impacted
By Lynn J. Richardson
Friday was a day of big changes for a local bank and three of its top executives.
Community First Bancorporation, Seneca, South Carolina (“Community First”) (OTC: CFOK), the parent company of Community First Bank, and Security Federal Bancorp, Inc., Elizabethton, Tennessee (“SFB”) (OTC: SFBK), the parent company of Security Federal Bank, has announced the signing of a definitive agreement for Community First to acquire Security Federal in a cash transaction.
That means a new name for Security Federal and major changes for three of its top executives: President Carmella Price officially retired on Friday, March 19; SFB Chairman, President and Chief Executive Officer Bill Hampton has stepped down; and David LeVeau, Chief Financial Officer and Executive Vice President will take on a new role with a subsidiary of Community First Bank.
Security Federal’s new name will be “Security Federal Bank, a Division of Community First Bank.”
“We are delighted to provide our customers, shareholders and employees with the opportunity to partner with Community First,” Hampton said. “Our merger with Community First will provide our customers with access to expanded product offerings and services and also deliver value for our shareholders. Also, the establishment of the East Tennessee Advisory Board consisting of our Directors will allow us to stay connected to our customers and continue to be involved in our community.”
Price, who was appointed to the Boards of the Directors of the Bank and the Company in 2013, announced her retirement effective March 19. She has been employed by Security Federal Bank since 1973 and has supervised lending for the bank for 30 years. In January 2011 she was promoted to President of Security Federal Bank. Retired from serving on the Board of the Carter County Community Board for Mountain States Health Alliance, she currently serves on the Industrial Board for the City of Elizabethton and is a member of the Elizabethton Rotary Club having served as President in 2004-2005.
“I know this little bank inside and out and have worked for the Hamptons since 1973,” Price said. “It has been an honor to serve this community and our customers. Over the years, they’ve entrusted me with their money and their homes. It’s an experience I will never forget.”
David LeVeau, who has been Chief Financial Officer and Executive Vice President of Security Federal since 2013, will take on a new role as a result of the acquisition, becoming the Director of Accounting for one of the company’s subsidiaries, SeaTrust Mortgage based in Wilmington, NC, but will remain in the community.
LeVeau currently serves as President of the Elizabethton/Carter County Chamber of Commerce, and is active in the Elizabethton Kiwanis Club, the Carter County Joint Economic and Community Development Board and the Boys and Girls Club of Elizabethton/Carter County.
“I’m looking forward to the opportunity working with SeaTrust Mortgage and helping Community First Bank enter the East Tennessee market,” LeVeau said. “They will bring additional resources to our communities with the same high level of service that Elizabethton and Carter County are used to.”
Upon completion of the merger, Community First will establish an East Tennessee Advisory Board composed of the non-employee members of the board of directors of Security Federal Bank who choose to serve on such Advisory Board.
“Community First is excited to enter eastern Tennessee through our acquisition of Security Federal Bank,” said Richard D. Burleson, President and Chief Executive Officer of Community First. “This transaction will position us well for future growth in markets in eastern Tennessee and western North Carolina as we bridge our footprint across these portions of these states and South Carolina. We are pleased to partner with Security Federal Bank, a well-run community bank with a great history and deep ties in the communities it serves.”
“Our motto is ‘We Know What Matters,’ and what matters to us is to demonstrate to Security Federal’s customers and communities that we will provide them with the same excellent service and relationship banking they have come to expect from Security Federal over its remarkable almost 60 year history,” Burleson added. “Our goal is to be the bank of choice to our communities by offering first class, personal and common sense banking products and services. Community First looks forward to Security Federal’s employees joining with our associates and to providing those new colleagues with the resources, products and services needed to make them successful.”
The combined company will have approximately $575 million of assets and 12 offices serving South Carolina, North Carolina and Tennessee. The transaction was unanimously approved by the Board of Directors of each company. It is expected to close in the first quarter of 2021, subject to approvals from federal and state bank regulatory agencies and SFB’s shareholders.
SFB’s shareholders will receive cash of approximately $8.3 million or $33.00 for each share of common stock held by them. Additionally, immediately prior to the effectiveness of the merger, SFB will pay a special dividend on its outstanding common stock of approximately $2.8 million or $11.00 per share. The merger is expected to be immediately accretive to Community First’s earnings per share, excluding transaction costs.
Community First was advised by D.A. Davidson & Co. as financial advisor and Brooks, Pierce, McLendon, Humphrey & Leonard, LLP, as legal counsel. Janney Montgomery Scott LLC served as SFB’s financial advisor and Jones Walker LLP, Washington, DC served as SFB’s legal counsel.
About Community First Bancorporation
Community First Bancorporation is the parent holding company of Community First Bank, a South Carolina commercial bank, which operates ten full-service banking offices including eight in Seneca, Walhalla, Anderson, Williamston, Westminster and Greenville, SC and two in Charlotte and Dallas, NC. Community First Bank also operates a loan production office in Concord, NC. Its subsidiary, SeaTrust Mortgage, operates offices in Wilmington, Jacksonville, Charlotte and Greensboro, NC. Community First’s common stock is traded on the OTC Markets under the symbol “CFOK.”
About SFB Bancorp, Inc.
SFB Bancorp, Inc. is the parent holding company of Security Federal Bank. Security Federal Bank conducts its banking business from its main office at 632 East Elk Avenue, Elizabethton, TN and one branch office in West Elizabethton. Security Federal Bank’s deposits are insured up to the maximum legal amount by the Federal Deposit Insurance Corporation (FDIC). SFB Bancorp’s common stock is traded on the OTC Markets under the symbol “SFBK.”