Central Bancshares to purchase Marquette Bank Illinois

Northwestern Financial Review, Jan 15, 2002

[chronicle]

Central Bancshares, Inc. of Muscatine, Iowa has reached agreement with MFC, Inc., of Minneapolis to acquire Marquett6 Bank Illinois.

The sale encompasses four banking locations: Marquette's main facility and two supermarket banking centers in Galesburg, and a loan production office in Peoria. It includes approximately $125 million in deposits, $150 million in loans and other assets. Approximately 50 employees are affected. Terms of the transaction were not disclosed.

Transfer of ownership, which is subject to regulatory approval, is expected to be complete during the first quarter.

"These are four great locations in two great communities," commented Dennis McDonald, president and CEO of Central Bancshares. "It represents an excellent customer base served by an outstanding team of employees."

Central Bancshares owns three community banks in Iowa: Central State Bank in Muscatine; Freedom Security Bank in Coralville/Iowa City and Kalona; and West Chester Savings Bank in Washington. The pending acquisition is set to become the company's fourth subsidiary, boosting its total assets to $525 million.

Other than a change from the Marquette name, McDonald expects the transaction will involve few visible adjustments. Local autonomy and management are more important issues, he said.

"While the trend in our industry had been for the big banks to get even bigger and more centralized, we have somewhat a different philosophy," McDonald said. "We strongly believe in the concepts of independent charters, local decision-making and control and community involvement on the part of our affiliate banks. Over the coming months, as this transaction moves forward, a story will unfold - one where a hometown bank bucks the industry trend, returns to its roots, and focuses solely on serving the financial needs of the greater Galesburg and Peoria communities."

"I'm well acquainted with the folks from Central Bancshares," said Greg Kistler, president and CEO of Marquette. "I know the high value they place on maintaining the goodwill of our employees, our customers and the community. I am very excited to be associated with them, and I know their community bank philosophy will be a perfect match for us."

Prior to June 1999, Marquette Bank Illinois was known as the Farmers & Mechanics Bank. It was organized in 1869 and is the third-oldest, continuously-chartered state bank in Illinois.

Although unrelated, this deal announced in mid-December will occur during the same general timeframe as a much broader sale of Marquette banking and related financial properties owned by the family of Minneapolis-based businessman Carl Pohlad. In October, the family announced the pending sale of 117 banking, leasing and brokerage locations across seven Midwestern and Southwestern states to San Francisco-- based Wells Fargo & Co. That transaction also is expected to be complete, during the first quarter.