GAB seals merger with Peoples Bank

Shareholders will receive cash and stock for PCB shares

TELL CITY - German American Bancorp has completed its merger with PCB Holding Co., the parent company of Tell City-based Peoples Community Bank. Bank officials said an operational plan detailing the future of Peoples two banking centers in Tell City is expected to be released soon.

The banking deal, announced in May, merges Peoples with German American's Tell City affiliate, First State Bank. The merger closed Oct. 1. Under terms of the merger, each PCB share will be exchanged for $9 in cash and .7143 shares of German American stock. German American will issue approximately 257,000 shares of its common stock and pay an estimated $3.2 million in cash to PCB's former shareholders.

In a statement issued by German American, James Tyler, chairman of the PCB board and an attorney in Tell City, said the merger will benefit Peoples customers.

“There is no doubt this merger will benefit Peoples customers as well as the Tell City and Perry County community,” Tyler said. “Our philosophy of community banking and service to our customers is consistent with that of First State Bank and the entire German American organization.”

Tyler said the Peoples customers will continue to experience personal community banking they have received for years.

Three of Peoples' directors, Tyler, Dan Lutgring and Mark Ress, will join First State Bank's board of directors.

Peoples has two properties, including its main office in the 800 block of Main Street - a block away from First State Bank's main office. Peoples also has a branch at the intersection of Payne and 12th streets on the city's north side.

Neil Dauby, president and chief executive officer of First State Bank, said an announcement will come soon on the future of the locations.

“We'll be announcing an operations plan soon,” Dauby said. “Our first goal was to complete the regular aspects of the merger.”

Dauby predicted the north-side branch will remain open. First State Bank's other Tell City branch is located in the Rivergate Shopping Center.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.