In mid-October, Prosperity Bancshares Inc., the parent company of El Campo-based Prosperity Bank, announced the signing of two acquisition agreements. In one, Prosperity has agreed to acquire First Bancshares of Texas Inc. and its banking subsidiary, Midland-based FirstCapital Bank of Texas NA. The second agreement signed by Prosperity Bancshares indicates its intention to acquire Lone Star State Bancshares Inc. and its banking subsidiary, Lubbock-based Lone Star State Bank of West Texas. Both transactions are expected to close during the first quarter of 2023.
FirstCapital Bank operates 16 banking offices in six markets in the West, North and Central Texas regions, including its main office in Midland along with branches in Midland, Lubbock, Amarillo, Wichita Falls, Burkburnett, Byers, Henrietta, Dallas, Horseshoe Bay, Marble Falls and Fredericksburg. As of June 30, 2022, First Bancshares of Texas reported total assets of $2.1 billion, total loans of $1.6 billion and total deposits of $1.8 billion.
As part of the transaction with First Bancshares of Texas, Ken Burgess, Brad Burgess, Greg Burgess and Jeremy Bishop will join Prosperity Bank as regional presidents overseeing specific geographic markets in Prosperity Bank’s West Texas and Central Texas areas. Other members of FirstCapital management will maintain leadership roles in Texas markets.
“The combination of our companies enables us to enter the desirable Wichita Falls and Amarillo markets and the Horseshoe Bay, Marble Falls and Fredericksburg markets in the high-growth Central Texas area,” says David Zalman, senior chairman and CEO of Prosperity. “The customers of FirstCapital will be able to use any of our locations across Texas and Oklahoma after operational integration.”
“As we looked for merger partners, Prosperity stood out as an excellent fit for our customers,” says Ken Burgess, CEO of First Bancshares of Texas and chairman of FirstCapital Bank. “The ability to remain as a community-oriented bank serving our markets with the same people was important to us. FirstCapital sees this as an opportunity to be part of a larger community bank and offer its customers additional products, a larger branch network and the financial strength of a premier banking organization.”
“Joining Prosperity will accelerate and augment our ability to meet the expanding needs of our customers while maintaining strong commitments to the markets we serve,” adds Don Cosby, president of First Bancshares of Texas.
Lone Star Bank operates five banking offices in West Texas, including its main office in Lubbock and one branch in each of Brownfield, Midland, Odessa and Big Spring. As of June 30, 2022, Lone Star reported total assets of $1.3 billion, total loans of $933.5 million and total deposits of $1.2 billion.
Alan Lackey, Lone Star CEO, will join Prosperity Bank as West Texas area president and Melisa Roberts, Lone Star’s chief lending officer, will join Prosperity Bank as West Texas area vice president. Additional members of Lone Star management will maintain leadership roles in the combined organization.
“We continue to look for opportunities to enhance our presence in the West Texas area and Lone Star Bank’s locations in Lubbock, Midland/Odessa, Big Spring and surrounding areas are an excellent fit for us,” Zalman says.
“We are excited to unite Lone Star’s diversity of revenue, assets and commitment to excellent service…with the financial strength and regional footprint that Prosperity Bank offers to fortify our combined capabilities in the West Texas region,” Lackey says.
Both First Bancshares of Texas and Lone Star State Bancshares were advised by Stephens Inc. as financial advisor and Fenimore Kay Harrison LLP as legal counsel. Bracewell LLP served as legal counsel to Prosperity Bancshares.
Established in 1983, Prosperity Bank currently operates 272 locations: 65 in the Houston area, including The Woodlands; 30 in South Texas, including Corpus Christi and Victoria; 62 in the Dallas/Fort Worth area; 22 in East Texas; 29 in Central Texas, including Austin and San Antonio; 34 in West Texas, including Lubbock, Midland/Odessa and Abilene; 16 in the Bryan/College Station area; six in Central Oklahoma; and eight in the Tulsa, Oklahoma, area. As of June 30, 2022, Prosperity Bancshares Inc. reported assets of $37.4 billion.