Bill Vaughan: OakStar Bank was chosen from eight potential suitors.
A family-owned bank since the turn of the 20th century is taking on new ownership.
On July 14, the 1903-chartered Bank of Urbana announced Springfield-based OakStar Bank was chosen as its suitor.
Bank of Urbana President Bill Vaughan, a fourth-generation owner of the company who’s nearing retirement, said since no immediate or extended family members were interested in taking his reins, it was important to seek out a buyer with similar values.
“We felt like we had to take a hard look at our opportunities,” he said. “I’ve been here full time since I graduated from college, and that’s been 42 years ago.”
Enter OakStar, a relative newcomer formed by 38 southwest Missouri investors in 2005.
Vaughan said the fact OakStar also is locally owned played a large role in the selection out of eight options, which were mostly regional.
“We do seem to share a lot of the same philosophies on community banking,” he said. “We are very excited about the possibilities of what the two organizations can do together.”
OakStar President and CEO Randy Johnson said while Bank of Urbana’s profitability was a bonus, the culture fit was the most important aspect.
“The numbers don’t always make a deal,” he said.
Vaughan, 64, plans to stay on as an advisory director to ease the transition as the deal closes. His retirement date has not been set. Johnson said the transaction is likely to close in the fourth quarter, pending regulatory approvals, with the transitionary phase to occur in first-quarter 2017.
OakStar Chief Operations Officer Rob Buchanan said via email Bank of Urbana would take on the OakStar name.
In the deal for undisclosed terms, OakStar will pick up $180 million in assets, $150-$160 million in deposits, 48 employees and four branches: one each in Urbana, Hermitage, Buffalo and Macks Creek.
Combined, the company would have $620 million in assets, roughly $600 million in deposits, 150 associates, six branches, a mortgage office in Kansas City and a loan production office in Florida. OakStar, which last year posted annual revenue of $21.85 million for 2013-15 growth of 42 percent, operates a branch each in Springfield and Bolivar, as well as the offices in Kansas City and Florida.
The Bank of Urbana deal represents the first acquisition in OakStar’s history, but it won’t be the last, Johnson said.
“Our No. 1 strategic objective is to retain our independence,” he said. “The idea of partnering with somebody that is promoting making decisions out of our marketplace is not the direction that our strategic plan would lead us. We’re a big proponent of community banking.
“I think regional banks – banks where policies and decisions are made outside of our marketplace – are not as uniquely positioned to make good local decisions.”
