Peoples Bancorp has agreed to acquire Capital Bancorp in an all-stock transaction valued at about 728.1 million dollars, under a merger agreement signed on 29 September 2026 and announced the following day.
Capital shareholders will receive 1.11 Peoples shares for each Capital share, with cash paid only for fractional shares. That implies 43.75 dollars per Capital share based on Peoples' 20-day volume weighted average price of 39.41 dollars as of 29 September 2026. Capital holders will own approximately 32 per cent of the combined company.
Peoples had total assets of 9.5 billion dollars at 30 June 2026 and operates 144 locations, including 127 full-service branches, across Ohio, West Virginia, Kentucky, Virginia, Washington DC and Maryland. Capital had total assets of 3.9 billion dollars, gross loans of 3.1 billion dollars and deposits of 3.4 billion dollars at the same date. The combined business would hold roughly 14 billion dollars in assets, 10 billion dollars in loans and 11 billion dollars in deposits across more than 150 locations in eight states and Washington DC.
Tyler Wilcox, President and Chief Executive Officer of Peoples Bancorp, will lead the combined company. Three Capital directors will join the Peoples board at or promptly following closing. Capital's chief executive is Edward Barry. The agreement carries a termination fee of 30.66 million dollars payable by Capital in specified circumstances, and Capital's directors and executive officers have signed support agreements.
The transaction is expected to close in the first half of 2027, subject to both shareholder votes, regulatory approvals, effectiveness of a registration statement, Nasdaq listing approval and a tax opinion. Peoples says the deal is immediately accretive to 2027 earnings before one-time costs, with tangible book value earnback under three years and pro forma return on average tangible common equity of about 20 per cent.
What Peoples is buying is not branches. Capital runs four segments, and fee-based revenue was around 22 per cent of its total revenue in the second quarter of 2026. Those segments include OpenSky, a secured credit card business, and Windsor Advantage, which services a government-guaranteed loan portfolio of roughly 3.4 billion dollars, alongside commercial banking and a mortgage unit. Buying a 3.9 billion dollar bank with a fifth of its revenue coming from non-branch businesses is a diversification trade rather than a deposit grab.
The market priced it that way on the day, marking the buyer down and the seller up, which is the normal pattern for an all-stock acquisition at a premium.
For a board, this is the current template in US regional banking: reach roughly 14 billion dollars in assets, acquire diversified fee streams rather than more of the same balance sheet, pay in paper rather than cash, and accept a sub-three-year tangible book earnback and three seats for the seller's directors as the price of agreement. Cost savings were not disclosed, which is itself notable in a deal justified on earnings accretion.
