SmartBank to buy CapStone in Alabama for $84.8 million

Billy Carroll, president and CEO of SmartFinancial, left, and Miller Welborn, chairman of SmartFinancial, speak during an interview in the offices of Cornerstone Bank onTuesday, Sept. 1, 2015, in Chattanooga, Tenn. Billy Carroll, president and CEO of SmartFinancial, left, and Miller Welborn, chairman of SmartFinancial, speak during an interview in the offices of Cornerstone Bank onTuesday, Sept. 1, 2015, in Chattanooga, Tenn.

By Dave Flessner May 23, 2017 3 min read

SmartBank bought Cornerstone Community Bank in 2015 and eliminated Cornerstone’s branding in early 2016.

Less than two years after acquiring the former Cornerstone Bank in Chattanooga, the Knoxville-based SmartBank agreed Monday to buy one of the biggest community banks in Tuscaloosa, Ala., to help expand the East Tennessee bank into Alabama.

Smart Financial Corp., the parent company of SmartBank, will pay $84.8 million in cash and stock to buy Capstone Bank in Tuscaloosa, home of the University of Alabama. Upon the completion of the transaction, the combined bank will have asssets of more than $1.5 billion.

Miller Welborn, the Chattanooga businessman who chairs Smart Financial, said the purchase will help boost SmartBank’s footprint in the Southeast and improve company profits in 2018. The purchase, which Welborn hopes to duplicate in the future with other acquisitions of community banks across the Southeast, continues the bank’s strategy to grow in college towns and growing Southern markets.

Smart Financial Corp., the parent company of SmartBank, will pay $84.8 million in cash and stock to buy Capstone Bank in Tuscaloosa, home of the University of Alabama.

Banks at a glance

Capstone BankHeadquarters: Tuscaloosa, Ala.Started: 1978No. of offices: Eight in four Alabama countiesMarket presence: Capstone is the fourth biggest bank among 24 banks operating in metro Tuscaloosa, Ala.2016 assets: $487.1 million2016 bank net income: $3.7 millionStaff size: 99CEO: Robert KuhnSmartBankHeadquarters: KnoxvilleStarted: 2007No. of offices: 14 in three East Tennessee counties, two Florida counties and one George countyMarket presence: The third biggest bank in Sevier County and the eighth biggest bank in metro Chattanooga2016 assets: $1.06 billion2016 bank net income: $6.5 millionStaff size: 219CEO: Billy Carrroll

“As a graduate of the University of Alabama, I finally convinced all these people from UT in Knoxville that if Tennessee can’t beat Alabama we might as well join them,” Welborn quipped Monday after announcing the purchase.