On June 26, the Colorado-based National Bank Holdings Corporation announced its acquisition of Peoples, Inc., the parent company of Colorado-based Peoples National Bank and Kansas-based Peoples Bank, for $36.3 million and 3.4 million shares of NBHC stock.
Peoples Bank, the 28th largest bank in New Mexico, operates five locations in Taos County - in Questa, Red River, in Ranchos de Taos, in the Plaza and within Albertsons. The bank prides itself on a long history - it was founded in 1871 in Ottawa, Kansas. More than a century later, the Winter family purchased the bank and has been operating it for the past 43 years.
Peoples takes pride in its "banking unusual" slogan. Taoseños might also know Peoples Bank for its ubiquitous orange pens, as well as the chocolate chip cookies it serves in its offices. Its office in Albertsons is also open seven days a week, including 11 a.m.-3 p.m. on Sunday.
Under the merger, Peoples Bank will get a new name and customers will be able to access more bank locations in other states. It is unknown at this time whether or not NBHC will keep the same hours after it takes over.
"The transaction with Peoples bolsters our presence in our home markets of the Colorado Front Range and the greater Kansas City region," National Bank Holdings CEO Jim Laney said in a statement. "More specifically, the acquisition provides a strong market position in the attractive Colorado Springs and Overland Park markets and expands our franchise into northern New Mexico."
While most mergers tend to be motivated by consolidation and layoffs, Peoples Bank CEO and General Council Wint Winter Jr. characterized the move as one that expands the geographical operations of NBH's banks, which are mostly located in the Kansas City region, Texas and Colorado. As a result of the deal, Peoples Bank customers will gain access to 86 NBH-owned bank branches across those geographical areas.
"It is rather sort of an 'offensive move' - a move to add business to NBH that they did not have before," Winter said. "In the Kansas and Colorado markets, where both banks coexist, there is only one geographic area where the branches overlap."
Winter said that NBH had been interested in the esteemed reputation of Peoples Bank's service as one of the reasons for the merger.
"We've done very well in Taos County, and our guests reflect that in high satisfaction scores," Winter said. "They're [NBH] very interested in our service model."
NBHC is a publicly traded company and conducts its main operations through a subsidiary, NBH Bank. Blackrock and T. Rowe Price are some of NBHC's top shareholders. In the past two weeks, since the announcement of the merger, the corporation's shares have hovered around the $33.63 mark.
The move to acquire Peoples will expand NBHC's holdings in Colorado, Kansas and New Mexico. The deal will not close until October 2017. By early January, Peoples Bank locations will be renamed to match two of the brands already owned by NBHC, depending on their market. Its New Mexico locations will operate under the name of Hillcrest Bank, the name the group uses in Texas. Its Kansas City regional locations will operate under the local Bank Midwest brand.
Under NBH, Winter said, Peoples Bank will be able to offer a larger loan limit. Additionally, Winter expressed confidence that NBH would not lay off staff.
"They're going to keep the same people in Taos," Winter said. "They were motivated in us to save people and to learn."
As part of the deal, Peoples Bank will divest or phase out its national mortgage business, which has 25 loan originating branches from California to Florida. Winter stated that this process shouldn't affect Taos County customers.
In addition, Winter said that members of his family will end up wielding influence in the larger company, as they will make up the second largest shareholder group of NBH, with 11 percent of the company's stock.
"We wouldn't do the deal with [NBH] unless we weren't very confident in them as a company," Winter said. "I can confidently say that people in Taos County will see virtually no change in the banking they've enjoyed with us."
Other institutional quirks appealed to Peoples Bank leadership during the sale. Winter explained that Peoples has called its customers "guests," its employees "bankers" and its branches "stores." When Peoples Bank officials found out that NBH's banks also called these components different things - customers as "clients," employees as "associates" and branches as "banking centers" - they felt that the two company cultures were compatible.
"I am very confident that NBH will be a very loyal steward of 'banking unusual' values," Winter said.
Winter stated that most family businesses last 20 years before being acquired by larger groups. For his family's bank to have lasted more than 40 years, in his view, was an impressive outcome.
"It's the natural conclusion of a family-owned business," Winter said. "This is less of a sell-out and more of a buy-in. This is a true merger of us joining them. We're buying in to what they have."
To some Peoples Bank customers, the merger caught them by surprise.
"I'm not happy I didn't know," Peoples Bank customer Gary Valencia said, who had been unaware of the sale until The Taos News asked him about it.
Others cautiously tallied the costs and benefits of using local versus larger banks.
"I've enjoyed Peoples Bank, but that's why I have Chase - because it's worldwide," Ashley Houser said, another Peoples Bank customer, who explained that he liked the regional aspect of Peoples Bank, though he finds it necessary to belong to an international bank, such as Chase, because he travels a lot. "I think we'll just have to wait and see."