Provident Financial Services Inc (PFS)

Provident Financial Services Inc (PFS) stock experienced a significant decline of 6.64% following regulatory consent for its merger with Lakeland Bancorp, Inc. (LBAI). The merger, announced in September 2022, received approval from the Federal Deposit Insurance Corporation and the New Jersey Department of Banking and Insurance, subject to certain conditions and commitments.

• Merger Conditions: Before completing the merger, Provident Financial Services, Inc. (PFS) is required to fulfill several conditions, including completing a $200 million capital raise through the issuance of Tier 2 qualifying subordinated debt. Additionally, PFS must maintain specific capital ratios and loan-to-capital ratios for three years following the completion of the deal. The combined company's board of directors will consist of nine directors from Provident Financial and five directors from Lakeland Bancorp.
• Merger Agreement Extension: To allow for the completion of the merger conditions, PFS and LBAI have extended the merger agreement to June 30, 2024. The companies are now awaiting approval from the Federal Reserve to proceed with the merger and complete the subordinated debt issuance.
• Strategic Benefits of the Merger: The merger between PFS and LBAI aims to create a top-tier super-community bank in New Jersey. The combined entity is expected to have approximately 4% of all bank deposits in the state and will operate under the Provident Financial name. The merger will enable the combined bank to expand its product offerings and better serve the financial needs of customers and communities.