CoBank of Denver, Colo., has merged with U.S. AgBank of Wichita, Kan., as the result of a nod of approval from the Farm Credit Service affiliate's boards of directors.
Ballots for the merger vote were tabulated this month.
Regulations issued by the FCS Administration prohibit disclosure of the exact result of the balloting by the banks. However, reports indicate that a substantial number of stockholders in both organizations approved the merger.
"We're delighted that our stockholders have demonstrated such enthusiastic support for this merger, which will create an even stronger, more durable bank that is better able to fulfill its mission to serve future generations of rural borrowers," says Everett Dobrinski, CoBank board of director's chairman.
"Stockholder voting is a critical step in merger approval process," says John Eisenhut, chairman of U.S. AgBank. "We look forward to receiving final regulatory approval and closing the merger at the beginning of the year. When accomplished we can begin delivering the numerous benefits that this transaction offers to our customers across the country"
CoBank and U.S. AgBank executed a letter of intent to merge in late 2010.The merged bank will do business under the CoBank name and will be headquartered in Colorado, but will maintain U.S. AgBank's existing presence and operations in Kansas and Sacramento, Calif.
It will also continue to be organized and operate as a co-op, with eligible borrowers earning cash and equity patronage based on the amount of business they do with the organization.
Robert B. Engel, CoBank president and CEO, will remain as the chief executive of the combined entity. Darryl W. Rhodes, U.S. AgBank president and CEO, will retire in connection with the merger.
Rhodes notes that the bank will have more than $90 billion in projected assets after merging, and a well-defined loan portfolio encompassing every major sector of U.S. agriculture, as well as rural water, power and communications industries.
"Through its wholesale lending to 30 Farm Credit associations, and direct lending to agribusiness and rural infrastructure companies, the combined bank will be one of the leading providers of credit to America's rural economy," he states