Griffin Serves as Exclusive Financial Advisor to Guaranty Bancorp, Inc. in Pending Merger with Bar Harbor Bankshares
Overview
Guaranty Bancorp, Inc. is the bank holding company of Woodsville Guaranty Savings Bank, a New Hampshire state-chartered bank founded in 1889. The bank is an indispensable partner in its local communities, has a long tenured group of leadership and employees and ownership has been closely held. The bank operates nine branches in New Hampshire and had $456 million in net loans and $530 million in deposits as of December 31, 2024. The bank has strong and loyal depositors, which have helped it weather the rapidly rising interest rate environment. Woodsville Guaranty boasted a 27% deposit beta as of the end of 2024 in the current interest rate cycle, and a fourth quarter 2024 cost of interest-bearing deposits of 1.38% versus its peers at 2.22%.
Situation
As the Federal Reserve began cutting interest rates in late 2024, the anticipation of deposits becoming volatile again caused buyers to search for and actively solicit targets with strong and low-cost core deposit franchises, which created the dialog leading to a deal. Certain shareholder dynamics and desires could best be addressed with a marriage to a well-established, publicly traded partner. Policy uncertainty in Washington created public market volatility and the interest rate environment made fair value accounting a hurdle regarding regulatory capital and dilution to any buyer’s tangible book value.
Solution
On March 11, 2025, Guaranty announced a merger with Bar Harbor Bankshares, an NYSE-traded (symbol BHB) strong and well reputed community bank with a market capitalization of approximately $450 million and the regulatory capital to complete the transaction while providing for future growth and community investment. Bar Harbor will exchange 1.85 BHB shares for each share of Guaranty in a 100% stock transaction, which was valued at $41.6 million at announcement, or approximately 130% of Guaranty’s tangible book value on December 31, 2024.
James Graham, President and CEO of Guaranty, will join the boards of directors of Bar Harbor Bankshares and Bar Harbor Bank & Trust following closing. Guaranty shareholders will own approximately 8.1% of the combined company following closing. The transaction is expected to close in the second half of 2025.
