v3.26.1
BUSINESS COMBINATIONS
 3 Months Ended
Mar. 31, 2026
Business Combination [Abstract]  
BUSINESS COMBINATIONS

NOTE 15 – BUSINESS COMBINATIONS

Acquisition of Frontier Holdings LLC: At close of business on January 1, 2026, the Company acquired 100% of the outstanding common shares of Frontier Holdings LLC, ("Frontier"). Frontier is the parent company of Frontier Bank, which has seven branch locations in Lincoln, Falls City, Madison, Norfolk, Omaha and Pender. Results of operations of Frontier were included in the Company's results of operations beginning January 2, 2026. Acquisition-related costs associated with this acquisition were $5,333 ($4,142 on an after-tax basis) and are included in merger expense in the Company's income statement for the three months ended March 31, 2026.

Information necessary to recognize the fair value of assets acquired and liabilities assumed is currently still ongoing and such amounts are subject to change for up to one year from the acquisition date. The acquisition was an expansion of the Company's footprint into Nebraska with the addition of seven branch locations throughout the state.

The following table summarizes the amounts of assets acquired and liabilities assumed by Frontier on January 1, 2026.

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of consideration:

 

 

 

Cash

 

$

32,501

 

Common Stock

 

 

99,095

 

 

 

$

131,596

 

 

 

 

 

Recognized amounts of identifiable assets acquired and

 

 

 

liabilities assumed:

 

 

 

Cash and due from banks

 

$

12,819

 

Interest bearing time deposits in other banks

 

 

100

 

Available-for-sale securities

 

 

83,014

 

Loans

 

 

1,278,732

 

Premises and equipment

 

 

2,678

 

Core deposit intangible

 

 

10,830

 

Other assets

 

 

27,831

 

Total assets acquired

 

 

1,416,004

 

Deposits

 

 

1,131,969

 

Federal Home Loan Bank advances

 

 

140,181

 

Other borrowed funds

 

 

22,486

 

Interest payable and other liabilities

 

 

12,629

 

Total liabilities assumed

 

 

1,307,265

 

Total identifiable net assets

 

 

108,739

 

Goodwill

 

 

22,857

 

 

 

$

131,596

 

 

The following tables reconcile the par value of Frontier loan portfolio as of the purchase date to the fair value indicated in the table above. For purchased seasoned loans and purchase-credit deteriorated assets, as required by CECL, the fair value mark is divided between an adjustment to par and an addition to the ACL. The addition to ACL represents the portion of the fair value mark attributable to expected credit losses and was determined by comparing a valuation that reflects management's loss rate assumptions with a valuation assuming no credit losses.

 

Purchased Seasoned Loans

 

Loan Par Value

 

 

Discounts from Other Factors Excluding ACL

 

 

 

Credit Marks in ACL

 

 

Purchase Price

 

Commercial real estate

 

$

733,497

 

 

$

(8,103

)

 

 

$

(1,108

)

 

$

724,286

 

Commercial and industrial

 

 

151,744

 

 

 

(817

)

 

 

 

(718

)

 

 

150,209

 

Residential real estate

 

 

130,492

 

 

 

(1,148

)

 

 

 

(114

)

 

 

129,230

 

Agricultural real estate

 

 

164,168

 

 

 

(2,164

)

 

 

 

(1,254

)

 

 

160,750

 

Agricultural

 

 

77,170

 

 

 

(84

)

 

 

 

(12

)

 

 

77,074

 

Consumer

 

 

8,287

 

 

 

28

 

 

 

 

(87

)

 

 

8,228

 

Total Purchased Seasoned loans

 

$

1,265,358

 

 

$

(12,288

)

 

 

$

(3,293

)

 

$

1,249,777

 

 

Purchase Credit Deteriorated Loans

 

Loan Par Value

 

 

Discounts from Other Factors Excluding ACL

 

 

Credit Marks
in ACL

 

 

Purchase Price

 

Commercial real estate

 

$

13,074

 

 

$

(1,497

)

 

$

(855

)

 

$

10,722

 

Commercial and industrial

 

 

11,291

 

 

 

(1,197

)

 

 

(1,962

)

 

 

8,132

 

Residential real estate

 

 

1,845

 

 

 

(240

)

 

 

(160

)

 

 

1,445

 

Agricultural real estate

 

 

7,867

 

 

 

(2,673

)

 

 

(440

)

 

 

4,754

 

Agricultural

 

 

2,086

 

 

 

(56

)

 

 

(202

)

 

 

1,828

 

Consumer

 

 

17

 

 

 

(6

)

 

 

(1

)

 

 

10

 

Total Purchase Credit Deteriorated loans

 

$

36,180

 

 

$

(5,669

)

 

$

(3,620

)

 

$

26,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Purchased Loans

 

Purchase Price

 

 

 

 

 

 

 

 

 

 

Purchased Seasoned Loans

 

$

1,249,777

 

 

 

 

 

 

 

 

 

 

Purchase Credit Deteriorated Loans

 

 

26,891

 

 

 

 

 

 

 

 

 

 

Total loans

 

$

1,276,668

 

 

 

 

 

 

 

 

 

 

 

Assuming the Frontier acquisition would have taken place on January 1, 2025, total combined revenue would have been $71,055 for the three months ended March 31, 2025, and $253,712 for the year ended December 31, 2025. Net income would have been $22,752 at March 31, 2025, and $40,506 at December 31, 2025. The pro forma amounts disclosed exclude merger expense from non-interest expense, which is considered a non-recurring adjustment. Separate revenue and earnings of the former Frontier locations are not available following the acquisition.

On April 2, 2025 the Company entered into an agreement and plan of reorganization with NBC Corp. of Oklahoma ("NBC"). The transaction was completed at close of business on July 2, 2025. Acquisition-related costs associated with the NBC transaction during the three months ended March 31, 2026 were $392 ($310 on an after-tax basis).