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With a wrap-up expected in the second quarter of 2023, First Bank and Malvern Bancorp Inc. entered into a definitive merger agreement under which the New Jersey institution will acquire the Pennsylvania-based parent company of Malvern Bank.

Announced Dec. 14, the deal is valued at approximately $149.5 million, according to the parties.

Following the closing of the transaction, First Bank will have approximately $3.68 billion in assets with 27 branches across seven Garden State counties, three eastern Pennsylvania counties, and one Florida county.

“This strategic transaction expands our market position and deposit share in eastern Pennsylvania, while complementing our strong organic growth strategy,” First Bank President and CEO Patrick Ryan said in a statement. “This merger is another example of what we believe are high-quality and low-risk transactions we are using to build size and scale, solidify our market position and expand our service area.”

In particular, Ryan highlighted Malvern’s commercial lending and private banking business in addition to its customer service.

Based in Paoli, a suburb of Philadelphia, the target has nine banking locations in Pennsylvania, New Jersey and Palm Beach, Fla. As of Sept. 30, 2022, the most recent information available, the bank had assets of approximately $1.04 billion, loans of approximately $815.6 million, and deposits of approximately $785.3 million.

“In addition, this transaction further strengthens our balance sheet through loan portfolio diversification and provides expanded access to cost-effective deposits,” Ryan continued. “Importantly, we expect the transaction will be significantly and immediately accretive to First Bank earnings per share and that the earn back on tangible book dilution to be under two and a half years.

“First Bank’s regulatory capital levels will remain strong, enabling us to continue to evaluate all appropriate growth opportunities,” he added.

“We are excited to be combining with a financially strong and strategically well-positioned community bank,” said Anthony Weagley, president and chief executive officer of Malvern Bancorp, in a prepared statement. “First Bank has an excellent track record and is successfully executing upon its vision to be a premier community bank focused on high-touch customer service throughout the New York City to Philadelphia corridor.”

The merger was unanimously approved by the boards of directors of both institutions; its completion is subject to the approval of First Bank and Malvern Bancorp shareholders in addition to customary regulatory reviews.

Last August, First Bank announced it would expand its footprint by acquiring two OceanFirst Bank locations.