CINCINNATI, OHIO — First Financial Bank, which is in the process of merging with Greensburg-based MainSource Financial Group, has announced it will invest $1.7 billion in community benefits over the next five years.
First Financial and MainSource each have branches in central and southern Indiana, with overlap in some markets and some branches in close proximity, bank officials said in July when their planned merger was announced.
Post-merger, the financial institution will have about $14 billion in assets.
Over the next five years after the merger, First Financial said it would invest by offering:
$510 million in mortgage lending in low- to moderate-income communities and borrowers.
$750 million in small business lending in low-to moderate-income communities.
$450 million in community development lending and investments.
$8.5 million in philanthropy across the bank’s footprint.
$25 million (eight new locations committed) in branch distribution and access for low- to moderate-income communities.
$1 million in dedicated marketing and communications for community development products and services.
The investment is part of a targeted community benefits agreement with the National Community Reinvestment Coalition and related partner organizations, the bank said. The coalition and its partners provided expertise and input and the plan and will continue to offer guidance through a joint advisory board designed to help fulfill the agreement.
The board will have half its members appointed by the coalition and will consist of committed community stakeholders with expertise outside of the bank and First Financial leaders.
In addition to the planned investments in community benefits, First Financial will continue to focus on providing employees with opportunities to serve their communities through paid volunteer time and giving campaigns with the United Way, bank officials said.
In addition to the community benefit agreement, there is a large focus on low- to moderate-income census tracts lending, bank locations and access, and grants and sponsorships. To provide measurement for the plan, First Financial said it will ensure:
At least 50 percent of philanthropic programs will go toward organizations specifically supporting low- to moderate-income communities and individuals, representing a nearly 100 percent increase in financial support to the organizations.
As part of the merger, no branch locations in low-income census tracts will be closed and there is a commitment of eight new locations to be added in low- and moderate-income neighborhoods.
A target of 10 percent of First Financial’s sourceable spending over the course of five years will be implemented through a formal Supplier Diversity Program for inclusion of minority-owned, women-owned and those with disabilities-owned businesses.
Creation of a $5 million direct loan pool for mortgages and home improvement loans of less than $50,000.
Commitment to continued employment of community development mortgage loan officers, increasing to a total of eight.
“Investing in our communities has always been a commitment and priority for First Financial Bank. We think this is the perfect time to intentionally engage with partners to set a plan that strives to truly be outstanding,” said Claude E. Davis, CEO of First Financial Bank.
Earlier, bank officials said that the joint company would continue its philanthropic efforts in Columbus. First Financial is title sponsor of Ethnic Expo, and MainSource is an executive sponsor of the Mill Race Marathon.
To address the economic impacts resulting from the merger, First Financial is making a $1 million commitment to Greensburg, and a minimum of 100 jobs will be retained at the former MainSource headquarters, bank officials said.
“Giving back to the community is a fundamental principle and commitment of MainSource Bank,” said Archie M. Brown, Jr., chairman, president and chief executive Officer of MainSource.
Currently, the two banks have about 2,400 employees combined (1,500 from First Financial and 900 from MainSource) and 200 banking centers throughout Indiana, Ohio and Kentucky. Bank officials said in July that about 400 positions would likely be eliminated, mostly through attrition, such as retirements and resignations.
Both banks have undergone consolidations recently, with MainSource closing about 25 offices in the past five years, and First Financial closing more than 70.
The transaction of First Financial acquiring MainSource is expected to close in early 2018, and is valued at $1 billion.