Longtime Brookings firm buys way into Sioux Falls

Fishback Financial acquires First American Bank

Fishback Financial Corporation announced Monday it is entering the Sioux Falls banking market with the acquisition of FMB Bankshares, the holding company for First American Bank & Trust.

The acquisition should be complete by early 2006. The name of the bank will change to First Bank & Trust at its five locations in southeastern South Dakota. Terms of the transaction were not revealed, and the deal still must be approved by state and federal banking agencies.

"Our strategy continues to focus on markets along the I-29 corridor, which we believe is the economic engine for South Dakota," said Van Fishback, chief executive officer for Fishback.

"Adding four significant markets along the corridor allows us to expand our services to the region."

This is the second bank acquisition in the past week. On Thursday, Great Western Bank announced the purchase of Security Bank and Mortgage.

With the acquisition of FMB, which has $160 million in assets, Fishback would become the largest locally-owned bank holding company in the state, with assets of nearly $1.3 billion.

First American Bank & Trust has two locations in Sioux Falls as well as offices in Madison, Canton and Watertown. The transaction will mean few changes for customers besides a new logo and name on the wall, said John Eikanger, president of First American Bank & Trust in Sioux Falls, who will stay on after the acquisition is final.

"It should be pretty smooth and seamless for customers," he said. "It's really the same people, the same bank at this point in time."

Brookings-based Fishback is the holding company for several community banks including First Bank & Trust in Brookings, Community State Bank of Milbank and the First Bank of White.

"We plan to continue operating with the great service that they have offered in the past," said Brian Thompson, president of Fishback Financial Services in Sioux Falls. "Ideally, we will be looking to adding locations in the Sioux Falls market as we continue to grow."

Fishback opened a commercial loan office in late 2004 in Sioux Falls with the intent of getting into the retail banking industry as well. This latest expansion will allow Fishback to grow with the city over the next 20 years, said Steve Metli, vice president of business development.

"We want to provide every service that the other banks in Sioux Falls provide - but we want to do it better," Metli said.

First American Bank dates back to Madison in 1883 and operated under the name of First Madison Bank for several years.

Dan Culey, CEO of FMB Bankshares, said the acquisition is a good fit for the community banks.

"We are excited to be part of an organization that has proven for over 125 years to be fundamentally committed to community banking," Culey said.

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.