United States Federal Regulators Greenlight the Combination of United and Piedmont Airlines
The Federal Reserve has given the green light to the $267 million acquisition of Piedmont Bancorp by United Bankshares, a move that significantly expands United Bankshares' market presence, particularly in Georgia. The approval came less than seven months after the merger was announced in May 2024.
The acquisition, which is set to close in early 2025, will see United Bankshares adding about $2.4 billion in assets and 16 new branch locations to its portfolio. This deal has driven strong loan growth, higher net interest margin, and improved profitability, contributing substantially to United Bankshares' record earnings in Q2 2025.
Competitive considerations and market impact have been favourably assessed. The acquisition broadens United's footprint into the Atlanta and broader Georgia region, enhancing its regional banking presence with added physical locations and deposit base. This gives United stronger competitive positioning against regional peers.
Financially, the deal improves net interest income by $2.3 billion in loans and $1.1 billion in short-term investments, boosting net interest margin to 3.81% and quarterly net income to a record $120.7 million. Earnings per share and overall revenue exceeded forecasts post-acquisition.
While net charge-offs increased slightly as a percentage due to portfolio growth, the credit quality remains robust, with reduced provision expenses signaling stable integration of acquired loans. Integration synergies have improved cost efficiency, with positive accretion from acquired loan portfolios at Piedmont compared to prior periods, implying operational benefits beyond mere scale.
The acquisition involves issuing 7.86 million shares and generates goodwill and core deposit intangibles, reflecting confidence in long-term value creation despite upfront costs.
The consolidated assets of the combined entity will be approximately $32.1 billion, making it the 70th-largest insured depository organization in the U.S. The combined entity will control total consolidated deposits of roughly $24.9 billion.
Key staff from both entities will be retained, with Piedmont Bank CEO Monty Watson serving as regional president for Georgia operations at United upon the deal's closure. United Bank's CEO, Richard M. Adams Jr., expressed excitement about expanding into the greater Atlanta area.
The transaction is expected to close in early 2025, with operational conversion likely in the first quarter of next year. United Bank's mortgage subsidiary operations will be consolidated into United Bank in early 2024.
One adverse comment was made on the proposal, alleging disparities in United Bank's mortgage lending to Black and White borrowers in West Virginia and Virginia. However, United Bank defended its mortgage lending practices, stating that denial rates for Black applicants are comparable to peer institutions.
United Bank received an overall "satisfactory" rating at its most recent Community Reinvestment Act evaluation by the Federal Reserve Bank of Richmond in October 2022.
The approval allows United Bank to merge with The Piedmont Bank and establish branches at its locations. The deal is expected to boost United Bankshares' scale, geographic reach, and profitability in a competitive regional banking market, positioning United to leverage expanded customer bases and diversified loan portfolios, while maintaining credit discipline and generating efficiency gains. This deal may pressure smaller competitors and elevate regional banking consolidation dynamics in the Mid-Atlantic and Southeast sectors.
The acquisition of Piedmont Bancorp by United Bankshares, worth $267 million, falls under the finance sector of business. This deal, expected to close in early 2025, will considerable boost United Bankshares' finance and business operations, thanks to the addition of $2.4 billion in assets and 16 new branch locations.
The industry-wide implications of this acquisition are significant, as United Bankshares' increased geographic reach and expanded customer bases position it stronger against regional peers, potentially driving further consolidation in the Mid-Atlantic and Southeast sectors.
