Mercantile Bancorporation
| Company type | Public |
|---|---|
| Industry | Banking |
| Founded | 1850 in St. Louis, Missouri, United States |
| Defunct | 1999 |
| Fate | Acquired by Firstar Corporation |
| Headquarters | St. Louis , United States |
Area served | Missouri, Iowa, Kansas, Illinois, Arkansas, Kentucky |
Key people | Thomas H. Jacobsen (CEO from 1996) |
| Products | Banking services |
Mercantile Bancorporation stood as the largest bank holding entity in Missouri before being acquired by Firstar Corporation in 1999.
Established in 1850, The Mercantile Bank of St. Louis originated in St. Louis, Missouri.
Under the leadership of CEO Thomas H. Jacobsen starting in 1996, the company embarked on a series of acquisitions that expanded its assets from $15.9 billion to $35.8 billion, notably including the acquisition of Mark Twain Bancshares.
At the time of its purchase, Mercantile operated 500 branches across Missouri, Iowa, Kansas, Illinois, Arkansas, and Kentucky, managing assets totaling $36 billion.
History
In December 1964, Mercantile Trust Company transitioned into a national bank, adopting the name Mercantile Trust Company National Association.
By 1970, the organization created Mercantile Bancorporation as a holding company to support acquisitions and regional growth.
In 1989, Thomas H. Jacobsen took over as president, CEO, and chairman from Donald E. Lasater, bringing with him experience gained at Florida-based Barnett Banks.
Growth within Missouri
In November 1991, Mercantile revealed plans to acquire Ameribanc, based in St. Joseph, along with its American Bank subsidiaries for $87 million in stock; this transaction was finalized in April 1992.
August 1993 saw Mercantile announce its intention to purchase United Postal Bancorp and its subsidiary United Postal Savings Association in St. Louis for $192 million in stock, a deal completed by January 1994 that established Mercantile as a top home lender in the St. Louis market.
In September 1994, Mercantile declared the acquisition of Central Mortgage Bancshares Inc., headquartered in Kansas City, for $97 million in stock.
January 1995 marked an agreement to acquire Springfield’s Southwest Bancshares Inc. for $23 million in stock.
Further expanding southeastern Missouri, Mercantile acquired AmeriFirst Bancorporation and its AmeriFirst Bank subsidiary based in Sikeston for $23.6 million in stock in February 1995.
October 1996 brought the announcement of Mercantile’s acquisition of Mark Twain Bancshares Inc. and its Mark Twain Bank subsidiary located in St. Louis for $855 million in stock. At that time, Mercantile operated 440 branches across Missouri, Illinois, Iowa, and Arkansas; Mark Twain maintained 39 branches around St. Louis and Kansas City. This transaction closed in April 1997.
In December 1996, Mercantile declared plans to acquire Roosevelt Financial Group Inc., based in Chesterfield, along with its Roosevelt Bank subsidiary for $1.07 billion through a combination of stock and cash. Before this merger, Mercantile had over 500 branches spanning Missouri, Illinois, Iowa, and Arkansas; Roosevelt operated 83 branches across Missouri, Kansas, and Illinois. Due to overlapping markets identified by the Federal Reserve, divestitures were mandated in five areas, prompting plans to close approximately 50 branches. The acquisition was completed by July 1997 with all branches rebranded by November of that year.
Expansion into Illinois
Mercantile's initial venture beyond Missouri occurred in August 1986 with the announcement to acquire First Bancshares Corp. of Illinois, headquartered in Alton, for an undisclosed stock consideration. This transaction, finalized in February 1987, incorporated First National Bank and Trust Company in Alton, Airport National Bank in Bethalto, and Midwest Information Processors Corporation into Mercantile's holdings.
In August 1991, Mercantile revealed plans to purchase Old National Bancshares, based in Centralia, which included two banking institutions, for $22 million paid in a combination of stock and cash; the acquisition concluded in December 1991. Later, in July 1995, Mercantile acquired First Sterling Bancorp from Sterling along with its subsidiary First National Bank of Sterling-Rock Falls for $24 million, with the deal closing in January 1996.
March 1996 marked the acquisition of Today's Bancorp from Freeport, encompassing two banks and 12 branches, for $87.2 million through cash and stock. Subsequently, in August 1996, Mercantile announced the purchase of Regional Bancshares Inc., located in Alton and including Bank of Alton, for $41 million.
In October 1997, Mercantile agreed to acquire HomeCorp Inc., based in Rockford, which operated 10 offices under its HomeBanc subsidiary; this stock transaction was valued at $45 million and was completed by March 1998 for a total of $51 million.
A significant expansion occurred in February 1998 with the announcement of a $697 million stock acquisition of Firstbank of Illinois Company from Springfield. This company operated 48 branches across Illinois and Missouri; the deal was finalized by July 1998. In the following month, August 1998, Mercantile acquired Financial Service Corporation of the Midwest and its Rock Island Bank subsidiary from Rock Island for $118 million in stock, completing the transaction within the same month.
Expansion into Kansas
In July 1992, Mercantile declared its intent to acquire MidAmerican Corp. and Johnson County Bankshares Inc., both based in Johnson County, for $129 million in stock. This acquisition brought MidAmerican Bank and Trust located in Overland Park, Johnson County Bank in Prairie Village, as well as banks situated in Topeka and Lawrence into Mercantile’s network. The transaction was completed by January 1993.
By December 1995, Mercantile announced plans to acquire Peoples State Bank from Topeka for $94 million; this deal was finalized in August 1996.
Expansion into Iowa
Mercantile announced the acquisition of Metro Bancorporation from Waterloo along with its subsidiary Waterloo Savings Bank for $55 million in stock during July 1993. The transaction closed in January 1994 and added a profitable commercial bank holding $378 million in assets to Mercantile’s portfolio; this entity was later renamed Mercantile Bank of Northern Iowa.
In December 1994, plans were made by Mercantile to acquire Plains Spirit Financial Corporation based in Davenport along with its subsidiary First Federal Savings Bank of Iowa, recognized as the state’s second-largest savings and loan institution.
In August 1995, Mercantile disclosed a $351 million stock acquisition of Hawkeye Bancorp headquartered in Des Moines, which operated a network of 65 bank branches. Later, in May 1998, an agreement was reached to purchase First Financial Bancorporation from Iowa City along with its First National Bank Iowa subsidiary for $169 million in stock; this acquisition was completed by September 1998.
Growth in Arkansas
In December 1994, Mercantile revealed its intention to acquire TC Bankshares Inc., headquartered in North Little Rock, through a stock transaction valued at $155.7 million.
By July 1997, Mercantile had announced plans to purchase Horizon Bancorp, located in Arkadelphia, with the acquisition finalized in February 1998.
Growth in Kentucky
Mercantile declared in January 1998 its plan to acquire CBT Corporation from Paducah, which operated four banks, for $285 million in stock. This transaction was completed by July 1998.
Acquisition by Firstar
Following the November 1998 merger of Star Banc Corporation with Firstar Corporation, the unified Firstar announced in May 1999 its $10.6 billion stock acquisition of Mercantile Bancorporation. The merger closed in September 1999, establishing the entity as the 13th-largest bank nationwide. After the merger, Jerry Grundhofer assumed the roles of president and CEO of Firstar, while Thomas H. Jacobsen, formerly Mercantile’s CEO, became chairman.