St. Louis bank makes offer for Gorman & Gorman Home Loans

The Springfield office of Gorman & Gorman Home Loans is part of a sale in the works to St. Louis-based Enterprise Bank & Trust.

Enterprise Bank, the banking subsidiary of Enterprise Financial Services Corp. (Nasdaq: EFSC), yesterday announced an agreement to acquire certain assets of Gorman & Gorman, a division of F&M Bank and Trust Co. Terms of the deal, which is pending regulatory approval, were undisclosed. Company officials expect a ruling in April by the Office of the Comptroller of the Currency, which governs F&M Bank.

Gorman & Gorman, which is based in St. Louis and also operates in Cape Girardeau, employs two loan officers at its 1540 E. Primrose St. office. Companywide, the firm employs 30 mortgage producers, underwriters and operations staff, and spokesman Brett O’Daniell said Enterprise plans to add three loan officers in Springfield within six months.

Under the deal, Gorman & Gorman founder Mark Gorman would join Enterprise as president of the bank’s mortgage group.

“We made a strategic decision to materially expand our mortgage business as a natural extension of our banking and wealth management businesses,” said Enterprise Executive Vice President Scott Goodman, who also is head of its mortgage, wealth management and fee income divisions, in a news release. “Acquiring Gorman & Gorman’s production organization and partnering with Mark to lead our companywide mortgage operations will immediately vault Enterprise into a significant market position in St. Louis.

"This acquisition also provides a strengthened management structure and operating platform to expand our mortgage capabilities in each of our markets.”

O’Daniell said Gorman & Gorman sells the majority of its loans on the secondary market to such investors as JPMorgan Chase, Wells Fargo and Citigroup, and with the backing of the $3.3 billion-asset Enterprise Bank, loan officers would be able to write loans beyond the standard fixed- and adjustable-rate mortgages.

“Enterprise gives us the ability to offer more portfolio loans,” O’Daniell said. “We’re still going to package loans to the secondary market, but on certain instances where it makes sense on possibly an investment property or with a good borrower who doesn’t fit into a (traditional) loan program, we would be able to put that on our own books. Enterprise would be the servicer and originator.”

Since its founding in 1994, Gorman & Gorman has originated more than $2.5 billion in mortgage loans, with more than 1,500 loans totaling nearly $200 million originating out of the Springfield office, O’Daniell said. In 2010, the firm was acquired by Hannibal-based F&M Bank and Trust Co.

With operations in metropolitan St. Louis, Kansas City and Phoenix, Enterprise Financial serves the niche of banking services for privately held businesses and their ownership, executives and professionals, according to the release.