The Nebraska Bankers Association (NBA) asked the Department of Banking and Finance (Department) to deny Premier Bank’s application to sell its assets and liabilities to GreenState Credit Union during a public hearing on Monday, September 20th. Premier Bank is a locally owned bank that holds $345 million in assets with three branches in Omaha and one branch in Nebraska City. Premier Bank began when it acquired Mid City Bank in Omaha which the Department of Banking closed in November of 2011 and the FDIC was named Receiver. Premier later purchased Farmers Bank and Trust Company in Nebraska City.
In May of this year, it was announced that Premier Bank had chosen to sell substantially its assets and liabilities to GreenState Credit Union of Iowa. The cross-industry acquisition with a Nebraska bank and out of state credit union would be the first such acquisition in the state. Nebraska state law requires that such applications are published in generally circulated newspapers to allow for public comment. After the comment period ends, the Department of Banking may act on the application or hold a public hearing on the matter if they find “substantive” objection. In this case, the Department decided to hold a public hearing and brought in a hearing officer whose duties it was to administer the hearing and ultimately provide a recommendation to Department Director Kelly Lammers. Director Lammers will ultimately decide whether to approve or deny Premier Bank’s application.
During the public hearing, Premier Bank’s legal team argued that the Department should approve the application on two fronts. The first is that Nebraska law allows for cross industry mergers and acquisitions and the second is that the state’s bank parity law allows state-chartered banks, like Premier Bank, to have the same rights and powers that national chartered banks have including the ability to execute a cross industry acquisition. The NBA legal team argued that contrary to Premier Bank’s position, the law doesn’t allow for out-of-state acquisitions like this one whereby an out-of-state credit union is acquiring a Nebraska state bank. They additionally made a process argument saying that the public notification was flawed because the notice cited the cross-industry acquisition law but not the parity law and therefore proper notice was not served. Premier Bank’s legal team called several witnesses from Premier Bank and GreenState Credit Union to bolster their position that three key components for approval existed including the integrity of both institutions’ officers and directors, deposits of Premier Bank’s customers would continue to be federally insured, and that “public necessity, convenience, and advantage will be promoted” with the acquisition. The NBA called no witnesses during the hearing.
The hearing officer, Lincoln attorney Jim Titus, will provide Director Lammers with a recommendation on the matter after reviewing briefs provided by both sides and information provided during the public hearing. The Director will ultimately approve or deny Premier Bank’s application to sell its assets and liabilities to GreenState Credit Union.