BankFirst Capital to add $456m in assets with Magnolia State Bank acquisition

BankFirst Capital Corporation, the Columbus, Mississippi-based parent company of BankFirst Financial Services, has signed a definitive merger agreement to acquire The Magnolia State Corporation, the holding company of Magnolia State Bank. The deal, which has been unanimously approved by both companies’ boards of directors, is expected to close in the third quarter of 2025, subject to regulatory and shareholder approvals. Once finalized, the transaction will significantly expand BankFirst’s presence across Mississippi, reinforcing its position as a key regional financial institution.

Under the agreement, BankFirst will integrate Magnolia State Bank’s operations into its growing network, adding six new locations and approximately $456 million in total assets. This acquisition will bring BankFirst’s total assets to $3.2 billion and expand its reach to 52 branches across Mississippi and Alabama.

What Drives BankFirst’s Expansion Strategy in the Southern Banking Sector?

For BankFirst, this acquisition aligns with a broader strategy of strengthening its position in Mississippi’s banking market. The company has pursued steady growth over the years, capitalizing on regional banking consolidation trends to enhance its customer base and operational scale. The addition of Magnolia State Bank, a well-established institution in Bay Springs, Mississippi, further cements BankFirst’s role as a leading financial services provider in the region.

Moak Griffin, President and CEO of BankFirst Capital Corporation, emphasized the strategic importance of this merger, highlighting its potential to deliver enhanced banking services while maintaining the community-centric approach both institutions value. He underscored that integrating Magnolia State Bank into BankFirst’s network would allow for a seamless transition, ensuring continued high-quality financial services for customers.

With a legacy dating back to 1888, BankFirst has cultivated a reputation for providing personalized banking solutions while expanding its footprint through organic growth and strategic acquisitions. Its operations span multiple locations, including Columbus, Jackson, Tupelo, and Oxford, with additional branches in Alabama. The bank offers a full suite of financial products, from consumer and business banking to digital services, mortgage lending, and merchant services.

What Does Magnolia State Bank Bring to the Deal?

Founded in 1975, Magnolia State Bank has played a vital role in serving customers in Jasper County and surrounding areas, with branches in Heidelberg, Hattiesburg, Taylorsville, Laurel, and Petal. Known for its relationship-driven banking approach, the institution has built strong ties with local businesses and individual customers alike. Its offerings include checking and savings accounts, small business loans, mortgage lending, and online banking solutions, catering to both personal and commercial banking needs.

Kris Mangum, CEO of Magnolia State Bank, expressed confidence in the merger, emphasizing that BankFirst shares the same core values of community-focused financial services. He assured customers and employees that the transition would maintain familiar banking relationships while expanding service capabilities. After the acquisition, Mangum will continue with the bank in a leadership role, serving as South Mississippi Regional President to oversee operations in the region.

How Will the Merger Affect Customers and Employees?

BankFirst has reassured Magnolia State Bank customers that they will continue to receive uninterrupted banking services. While account integration and system updates may occur over time, the transition is expected to be smooth, with efforts focused on preserving customer relationships and minimizing service disruptions.

Employees of Magnolia State Bank will also be retained, ensuring continuity in customer service and maintaining the institution’s trusted local presence. BankFirst’s leadership has reiterated its commitment to keeping Magnolia’s branch teams intact, reinforcing its approach to community-based banking.

Additionally, customers will gain access to a broader range of financial products and digital banking tools, including BankFirst’s mobile banking platform, remote deposit capture, and expanded business banking solutions.

What Are the Financial Implications for BankFirst and Its Investors?

BankFirst Capital Corporation, which trades under OTCQX: BFCC, has experienced notable stock performance over the past year. As of the latest market data, BFCC shares are trading at $41.25, marking a 43.48% increase year-over-year. The bank has demonstrated solid financial health, maintaining a price-to-earnings (P/E) ratio of 9.17 and earnings per share (EPS) of $4.50.

Investors have taken note of BankFirst’s steady growth trajectory, particularly its disciplined approach to regional expansion and asset growth. The company’s dividend yield of 2.42%, coupled with its consistent $1.00 per share dividend payout, underscores its commitment to delivering shareholder value.

Analysts have observed that BFCC stock has climbed 3.00% over the past week and 2.87% over the past month, reflecting positive sentiment surrounding the bank’s expansion efforts. While the stock reached an all-time high of $43.75 on January 10, 2023, it has remained resilient, signaling investor confidence in the company’s long-term strategy.

For investors, the acquisition of Magnolia State Bank is expected to contribute to BankFirst’s revenue growth, bolstering its loan portfolio, deposit base, and overall financial position. As a result, analysts consider BFCC a potential long-term buy, contingent on the successful integration of Magnolia’s operations and sustained market stability.

What Are the Regulatory and Legal Aspects of the Acquisition?

The transaction remains subject to customary regulatory approvals and Magnolia shareholder consent, though BankFirst shareholders will not be required to vote on the deal. Banking regulators will assess the merger to ensure compliance with federal and state banking laws, particularly in terms of market competition and consumer protections.

Southard Financial, LLC provided a fairness opinion to BankFirst’s board of directors, while Hunton Andrews Kurth LLP is serving as legal counsel. Magnolia State Corporation has engaged Olsen Palmer LLC as its financial advisor, with Jones Walker LLP handling legal matters.

How Does This Merger Fit into Broader Banking Industry Trends?

The U.S. regional banking sector has witnessed an increasing number of mergers and acquisitions as financial institutions seek to expand their market reach, diversify services, and optimize operational efficiencies. Smaller community banks often merge with larger regional players to remain competitive against national banking giants while still preserving a customer-centric approach.

The merger of BankFirst Capital Corporation and Magnolia State Bank aligns with this broader industry movement, reflecting a trend of regional consolidation aimed at strengthening financial institutions’ stability and service offerings. By increasing its asset base and geographic footprint, BankFirst is better positioned to compete in an evolving financial landscape, balancing technology-driven banking solutions with the personal touch that community banks are known for.

As the integration progresses, the success of this deal will largely depend on how effectively BankFirst maintains customer satisfaction, employee retention, and operational efficiency while leveraging Magnolia’s existing market strength. Investors, customers, and industry analysts will be watching closely to see how the combined entity navigates this next phase of growth.