Business First Bancshares
The roots of Progressive Bancorp’s
Melville had just taken the helm at Baton Rouge-based Business First. He figured that seeking the counsel of some other bank CEOs was a good way to start.
Cummings, who had succeeded his father, George Cummings Jr., in 2000, was at the top of his list. Melville was following the lead of his uncle, Business First founder and former Louisiana governor Buddy Roemer, so the two had something in common.
“George was the first CEO I went to have coffee with,” Melville told American Banker. “I was aware of his reputation. They had a very attractive brand. As I was learning to be CEO, I thought he would be a good place to start, as I kind of looked for mentors.”
“George and I both have that family connection, that second-generation-banker background,” Melville said. “I certainly understand what it’s like to have something you care about deeper than just a business.”
The $752 million-asset Progressive operates nine branches across four North Louisiana counties.
Cummings still remembers Melville’s call. “I asked him what kind of coffee he liked from Starbucks, bought him a cup and had it waiting when he got there,” Cummings told American Banker. “That was the start of a good relationship. When we kicked this [negotiation] off in earnest, he reminded me, `Do you remember buying me that cup of Starbucks coffee?'”
The common ground linking the two executives developed into a 15-year friendship and, ultimately, the merger that was announced Monday.
Cummings characterized the decision to sell Progressive as bittersweet. “But for me personally and my shareholders, it was time to go to a new phase, to create liquidity for our shareholders,” he said.
Cummings said he admired Business First’s growth into a multi-state regional institution under Melville’s leadership, For his part, Melville described Progressive as a “premier” community banking franchise, citing its low levels of problem loans and solid, low-cost deposit base.
“When you think about what it is that makes a bank valuable and attractive, you can start and stop with asset quality and a healthy, long-term deposit base,” Melville said.
Writing Tuesday in a research note, Chris Marinac, director of research at Janney Montgomery Scott, called the deal’s $83 million price tag reasonable, noting that Monroe, Louisiana-based Progressive’s cost of deposits is 80 basis points lower than Business First’s. Marinac reiterated his “buy” rating on Business First shares.
Hovde analyst Brendan Nosal characterized the transaction as “low-risk” for Business First, the holding company for b1Bank.
Progressive’s balance sheet, which amounts to about 10% of Business First’s $7.8 billion of assets, is “middle-of-the-fairway,” Melville said. He quickly added that the people on the other side of the table are the key factor in any M&A transaction.
“It really is about who it is you’re getting,” Melville said. “What kinds of clients and what their capabilities are. From a credit-quality standpoint, from a clientele standpoint and from a quality-of-bankers standpoint, this adds capabilities in a market that’s really important to us.”
Melville said he sees “a lot of good things happening” throughout North Louisiana, singling out Monroe as an especially attractive market. Indeed, the Monroe metropolitan area’s population increased by more than 20% between 2010 and 2020 and has continued to expand since then, topping 220,000 in 2024, according to the U.S. Census Bureau and the Federal Reserve Bank of St. Louis.
“There’s a gathering momentum in the Monroe area,” Melville said. “It may fly a little under the radar compared to some of the bigger metro areas, but Monroe seems to be on the right track. … When you look at Louisiana and even a lot of Texas, if you’re ranking [markets] that have good potential, Monroe, Rustin, Bossier City have to be on the list.”
The combined company will have assets approaching $9 billion, with $1.6 billion of loans and deposits in North Louisiana.
Progressive opened its doors in October 1975 under very humble circumstances. “I was in college,” Cummings recalled. “I came home to watch my father cut the ribbon on the new bank. Believe it or not, we opened in a mobile home. [George Cummings Jr.] had built a lean-to on the side for the drive-through and had a little night depository in there.”
Cummings said Progressive continues to be guided by his father’s simple philosophy. “He always told us business goes where it’s asked and stays where it’s appreciated,” Cummings said. “That’s the motto we’ve tried to live by as we’ve grown the bank.”
Business First’s acquisition of Progressive is an all-stock transaction, so Progressive’s shareholders are trading their stock in a privately held community bank for shares in a Nasdaq-traded company.
“This is going to create wealth and liquidity and [access to] the dividend stream b1Bank provides. On a personal level, selling the business your dad founded, yes, that’s an emotional decision, but it’s the right thing to do.”
