The proposed transaction is the latest and apparent final divestment of branches by West Des Moines-based Liberty Bank, which has been contracting its operations following orders from regulators to raise its capital ratios. With this transaction and another sale announced in July, Liberty Bank will have sold all of its remaining 12 branches by the end of this year.
The sale of the branches to Central Bank is expected to be finalized during the fourth quarter pending regulatory approval. Financial terms of the agreement were not disclosed.
"Since 1877, Central Bank has served communities in northwest Iowa," Central Bank President John Brown said in a press release. "With the opening of our West Des Moines branch in 2012, purchasing the Liberty Bank locations was the right opportunity for us to provide expanded service and personal attention in the Des Moines metro area."
Central Bank currently serves Storm Lake, Cherokee, Sioux City, Spirit Lake and West Des Moines with a total of seven branches, two drive-up locations and satellite branches in Quimby and Washta. The Liberty Bank branches include three in Des Moines, two in West Des Moines, and one each in Urbandale and Ankeny.
With its pending sale of five eastern Iowa branches to Marion-based City State Bank, Liberty Bank will have sold 19 branches in eight markets. Following its July announcement of the sales, Liberty Bank President and CEO John Rathjen told the Business Record the bank intended to maintain its Greater Des Moines presence. He could not be immediately reached for comment today.
In a joint press release with Central Bank dated Oct. 4, Rathjen said his customers "will see the same faces in their local branches and can carry out banking transactions as usual." Liberty Bank customers will receive updates on the sale in the coming weeks, he said.
"Between now and the closing date, the Central Bank and Liberty Bank teams will be working diligently to ensure a successful transition for our customers, communities and employees," Rathjen said in the release.