The proposed merger of a commercial bank founded two decades ago by three prominent Evanstonians, including a former Evanston mayor, was approved Wednesday by shareholders of both institutions at separate meetings in Chicago and Evanston.
The actions paved the way for First Evanston Bancorp., Inc., parent company of Evanston's First Bank & Trust Co., to merge into Chicago's Byline Bancorp, Inc.
The merger is expected to become effective at the close of business on May 31, according to Robert R. Yohanan, managing director and chief executive officer of the Evanston bank, who presided at the meeting of his bank's shareholders on the ninth floor of the Hilton Orrington Hotel Wednesday afternoon.
Earlier in the day, shareholders of Byline Bancorp signed off on the proposal at their meeting at 180 N. LaSalle St. in Chicago.
About 50 shareholders attended the meeting at the Orrington, including all three of the founders, who reminisced about gathering together some 23 years ago to discuss plans for launching a new bank in Evanston.
The three included Yohanan; James Lytle, a former alderman and two-term Evanston mayor; and banker Howard Kain. At the time, Evanston had lost its principal local banks to larger banking institutions headquarted in Chicago and beyond, thanks to the introduction of branch banking to Illinois and the elimination of the national prohibition against iinterstate banking.
The three founders identified their market to include individual Evanston families, the large number of not-for-profit organizations headquartered here, as well as a robust number of small and medium-sized businesses.
They deliberately elected not to pursue a large home mortgage business, which paid off for them enormously during the 2008 recession, when several banks took a hit as housing values declined,.
Kain recalled that more than 230 shareholders, primarily local residents, invested about $8.1 million in the initial stock offering.
"You bought into a start-up," Lytle said to the stockholders attending Wednesday's meeting.
All three lauded the efforts of its initial staff as a principal ingredient in the bank's success.
Yohanan summarized the emotions of the three founders with the words, "It's been an amazing journey."
Lytle said the bank had recently received a number of merger offers, but that Byline's was best because it had the strong financial support of two Mexican families that own about 25 percent of the stock and that there was little overlap between the two institutions.
Assuming that the proposed merger passes the muster of regulatory authorities and other requirements, First Evanston stockholders will receive 3.994 shares of Byline stock for each of their shares, plus an estimated $16.13 in cash for each share.
When the market closed Wednesday, Byline's stock traded at $22.91, which is higher than its $19.73 close on Nov. 24, 2017, when the merger terms were first disclosed.
Byline Bank operates 55 branches in the Chicago metropolitan area and one in Milwaukee. First Evanston operates 10 branches in Evanston and nearby suburbs.
As of Sept. 30, 2017, Byline had consolidated total assets of $3.3 billion, loans and leases of $2.2 billion, and total deposits of $2.5 billion.
First Evanston had total assets of $1.1 billion, total loans of $892 million, and total deposits of $994 million.