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Business & Tech

First Star Bank to be Acquired by ESSA Bancorp

The Bethlehem-based bank will merge with Monroe County's ESSA Bank & Trust, the companies announced Thursday.

This time next year, customers will likely be ESSA Bank & Trust customers. There is a First Star located in Nazareth's Center Square at 14 S. Main St.

In a press release dated Dec. 22, the firms announced ESSA is acquiring the Bethlehem-based First Star for about $24.2 million in a merger deal.

Subject to First Star shareholder and regulatory approval, the companies said they expect the deal to close in mid-2012.

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ESSA, which currently has 17 branches, will add First Star's nine locations in the Lehigh Valley, bringing its total to 26. No bank location closures are anticipated, company officials said, and all branches will operate under the ESSA Bank & Trust name.

“We are extremely pleased to be joining with First Star, an organization that, like ESSA Bank, has many decades of serving its communities. Throughout our discussions, we have seen strong cultural similarities between the two organizations, and a shared vision of locally-based banking and superior service,” said John E. Burrus, Chairman of ESSA Bancorp, Inc., via the press release.

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“Merging our organizations will create a community banking franchise with significant size and scope in the region. We have long recognized the opportunity to serve the Lehigh Valley, having entered this market during the past two years with three branch openings,” Gary S. Olson, President and CEO of ESSA, said.

Olson continues on to say, “One of our goals has been to build a banking organization with the size to compete effectively and have a significant presence in the Lehigh Valley. This combination will accomplish that goal, creating a $1.5 billion asset bank with 26 banking locations, with roughly one third of our combined deposits in the Lehigh Valley. Additionally, we envision being able to achieve cost savings of approximately 30 percent over the next two years.”

First Star Bank currently operates branches in Alburtis, Allentown, Bath, , Nazareth, New Tripoli, and Wind Gap.

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