Updated: Systematic Savings Bank to be acquired in $14M deal

Mark Bybee is serving as CEO of Arlo Financial.

Derek Fraley: Proxy statement likely to be released in a couple months.

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Last edited 11:50 a.m., April 18, 2024 [Editor's note: More information has been added.]

Springfield-based Systematic Savings Bank (OTC: SSSB), a century-old banking company, has entered a multimillion-dollar deal to be acquired by a financial holding company.

Arlo Financial Holdings Inc., an investor group led by Mark Bybee, penned a definitive agreement to purchase Systematic Savings Bank, according to a news release issued after close-of-business on April 17. Bybee said in a phone interview this morning that he is serving as CEO of Arlo, which has put together a team and a board of directors. He said further information would be released as the deal progresses.

Bybee previously served as president of OakStar Bank, among other past roles for the likes of Commerce Bank and U.S. Bank, according to his LinkedIn profile.

Arlo was registered in January with the Missouri secretary of state's office, and its business filing lists businessperson Steven Strobel as the incorporator. Businessperson Greg Snider's LinkedIn profile states he's the co-founder of Arlo. Strobel, too, is a co-founder, per his LinkedIn profile.

The release points to a $14 million purchase price for Systematic, equating to $23 per share, that's subject to adjustment based on the definitive agreement's terms. Arlo would become the holding company of Systematic through the deal, and it has plans in the works to raise at least $25 million of capital.

“The board of directors and management of Systematic have done a great job in building a strong Springfield-based community bank," Bybee said in the release. "We believe with our investment the bank will be even better positioned to grow, serve our customers and create solid returns for our shareholders.”

The deal must be approved by Systematic’s stockholders, among other closing conditions.

"This transaction allows us to partner with a local investor group that will continue our focus on providing customers with high-quality service as well as maintaining our deep commitment to the community we serve," said Derek Fraley, chair, president and CEO of Systematic, in the release.

The boards of Arlo and Systematic each have approved the deal, which also is subject to a private placement capital raise by Arlo and regulatory approvals. The deal is expected to close in the fourth quarter of 2024 or the first quarter of 2025. Systematic's website lists its board members as Fraley, Trevor Crist, Ryan DeBoef, Dianna Devore, Kim Kollmeyer, Jeff Seifried and R. Bradley Weaver.

Fraley became the bank's leader in 2017 after previously working for BancorpSouth, according to past reporting. Reached by email, he declined to provide further details, other than to say that a proxy statement is in the works to be released in a couple months.

Strobel's LinkedIn profile additionally indicates he's the co-owner of APC Solar and Ballparks of America, among other ventures. Snider, too, is a co-owner in APC Solar and Ballparks of America, according to his LinkedIn.

Arlo also has set up a LinkedIn page, with nine associated employees named publicly among connections on the social media network. Arlo employees include Ryan Jones as chief lending officer and Corey Harmon as senior lending officer, according to LinkedIn. Jones comes from OakStar, and Harmon previously worked for Central Bank, according to LinkedIn.

According to the release, Luse Gorman, PC, served as legal counsel to Arlo and Breyer & Associates PC served as legal counsel to Systematic in the deal.

Systematic had $64.6 million in total assets, $52.6 million in net loans receivable, $47.2 million in deposits and $10.5 million in total stockholders’ equity as of Dec. 31, according to the release. According to the latest Federal Deposit Insurance Corp. market share report as of summer 2023, Systematic Savings Bank holds 0.3% of local deposits at nearly $45 million.

Founded in 1923, Systematic became public on the over-the-counter market amid the pandemic, according to past reporting.