Research Update: Cadence Bank 'BBB+' Ratings Affirmed On Announced Acquisition Of Industry Bancshares; Outlook Remains Stable

On April 25, 2025, Cadence Bank, with dual headquarters in Tupelo, Miss. and Houston, announced it signed a merger agreement with Industry Bancshares Inc., the bank holding company for Bank of Brenham, Citizens State Bank, Fayetteville Bank, Industry State Bank, The First National Bank of Bellville, and The First National Bank of Shiner. We expect the acquisition will modestly strengthen Cadence's deposit franchise and overall competitive market position. However, we think there will be a meaningful decline in Cadence's capital ratios at closing, and increased interest rate risk from long-duration, and likely less liquid municipal securities owned by Industry Bancshares. We affirmed our 'BBB+/A-2' long- and short-term issuer credit ratings on Cadence Bank. The outlook remains stable. The ratings affirmation

...- On April 25, 2025, Cadence Bank, with dual headquarters in Tupelo, Miss. and Houston, announced it signed a merger agreement with Industry Bancshares Inc., the bank holding company for Bank of Brenham, Citizens State Bank, Fayetteville Bank, Industry State Bank, The First National Bank of Bellville, and The First National Bank of Shiner. - We expect the acquisition will modestly strengthen Cadence's deposit franchise and overall competitive market position. However, we think there will be a meaningful decline in Cadence's capital ratios at closing, and increased interest rate risk from long-duration, and likely less liquid municipal securities owned by Industry Bancshares. - We affirmed our '###+/A-2' long- and short-term issuer credit ratings on Cadence Bank. The outlook remains stable. - The ratings affirmation highlights our expectation that Cadence will improve its deposit funding and branch footprint in Texas, rebuild its capital ratios over time, and successfully manage the risk...

Research Update