HERMITAGE F.N.B. to divide operations, move headquarters here

Shareholders will receive stock in a new bank holding company in Florida.
THE VINDICATOR, YOUNGSTOWN, OHIO
By DON SHILLING
VINDICATOR BUSINESS EDITOR
HERMITAGE, Pa. -- F.N.B. Corp. is dividing its Florida and Pennsylvania banking operations into two companies and locating its northern headquarters here.
F.N.B. Corp. will be based in the company's original hometown and operate First National Bank of Pennsylvania and insurance, finance and trust companies.
A new holding company, which will be based in Naples, Fla., is to be created to oversee the First National Bank of Florida.
F.N.B. had moved its corporate headquarters from Hermitage to Naples, Fla., two years ago after a series of acquisitions in Florida. Senior managers of First National Bank of Pennsylvania had remained in Hermitage, however.
Gary Tice, F.N.B. president and chief executive, said the spinoff is being made because of confusion in the investment community about the two markets in which the company operates.
He also said company officials think dividing the company into two will create more value for shareholders. The company said it expects the combined cash dividend of the two companies would be 25 percent higher next year.
Cost reductions will be achieved by eliminating some positions as both companies strive to become more efficient. F.N.B. projects $12 million in after-tax savings for 2004.
Accounting charge
The restructuring will result in a $20 million charge on the company's accounting books, with most of the cost related to employee severance.
The plan calls for shareholders to receive one share of common stock in the newly formed Florida holding company for each share of F.N.B. stock they own. The Florida company, which hasn't been named, intends to file an application to have its stock traded on Nasdaq or the New York Stock Exchange.
F.N.B. expects the spinoff to be completed no later than January. It needs regulatory approval and will ask the Internal Revenue Service to rule that the deal is tax-free. Shareholders need not take any action related to the deal.
Officers
Tice would be chief executive of the Florida company and Kevin Hale would be chief operating officer. Garrett Richter would continue as president and chief executive of First National Bank of Florida.
The Pennsylvania holding company would be led by chairman Peter Mortensen and Stephen Gurgovits as president and chief executive. This company also will own Regency Finance Co., the Galvin, Jackson & amp; Starr insurance agency and the Pennsylvania operations of First National Trust Co.
Each company will have a separate board of directors.
First National Bank of Florida has $3.6 billion in assets and 61 offices in southwest and central Florida. First National Bank of Pennsylvania has $4.5 billion in assets and 130 offices in Pennsylvania and Ohio.
shilling@vindy.com