$17.5 million deal closes in MayFirst National Bank and Trust, founded in Powell in 1912, has entered into a $17.5 million merger agreement with Glacier Bancorp, Inc.The boards of Glacier and First Company (the bank's holding company) approved the sale, which includes all three bank locations in Powell, Cody and Lovell, earlier this month. The bank will continue to operate as First National Bank and Trust for the time being.

According to Dick Nelson, president of First National, “Employees, products, and services will remain the same.

“For our customers, who are obviously our main concern, (the merger) greatly enhances our ability to take care of our local customers. Glacier is putting considerable capital into the bank, enhancing what we can do going forward.

“Glacier allows us to keep our main banking systems in place. We'll have the (same) board of directors, for the most part.

The Nelson family will be involved in the day-to-day activities and management of the bank. From the customer stand-point, they'll see very little transition.”

Nelson added, “(We) will continue to operate as a stand-alone, independent bank ... the bank board is still the primary decision maker.”

Mick Blodnick, CEO of Glacier Bancorp, said, “It turns out to be the best of both worlds. You can have your cake and eat it too.”

Glacier, with headquarters in Kalispell, Mont., currently owns 10 (First National Bank will be the 11th) banking subsidiaries which provide commercial banking services in 56 communities in Montana, Idaho, Wyoming, Utah, Colorado and Washington. Glacier is publicly traded on the NASDAQ (GBCI) and is currently ranked No. 1 atop Bank Director magazine's list of top-performing banks in the nation.

“We knew about Glacier, they had some feeling about wanting to get into the Northwest Wyoming market,” said Nelson.

“With the global economy the way it is, we were looking for someone who had a similar culture as far as employees and communities go. We hired a firm in Texas to survey the marketplace. It was soon very apparent that Glacier was the best fit.”

According to Blodnick, the parties are hoping to close on the deal on May 1.

“(It's) pending approval from the regulators, the S.E.C. (Securities and Exchange Commission), getting the S-4, where we have to register the shares,” Blodnick said. “There's still work to be done, but we think the time frame is more than adequate.”

The Nelson family is establishing a new company to service the out-of-market loans that led to problems for the bank in late 2008.

“The family is assuming those, and (they're) going into a separate L.L.C. We're taking them off the balance sheet of the bank,” Nelson said.

Blodnick added, “It's tough to peg a figure at what they (the out-of-market loans) are really worth. We'll recapitalize the bank to make sure the bank has a significant amount of capital.

“This is a situation where you had a strong and respected bank that recently experienced difficulties centered around the purchase of out-of-market loan participations. By structuring the deal to distribute those participations to the current owners, we end up with a well-capitalized bank with superior asset quality, a great deposit base, strong customer relationships and a talented management team and staff.”

Nelson said they hope real estate prices will rebound, and the family will be able to recoup the value of those loans.

According to Blodnick, “(Customers) really shouldn't see much difference. For us, it's pretty easy for us because we don't change much. Our intent all the time is that you're going to grow the business. We (simply) have resources that a community bank may not have that we can bring to the table.”

Nelson added, “I appreciate that Mick (Blodnick), being the CEO of Glacier, was here (Monday) for a one-on-one with all our employees. That's the kind of communication process they operate with.”