First Hawaiian and TriCo Bancshares Announce $2B Merger

TriCo Bancshares will merge with First Hawaiian Inc. in a $2 billion all-stock transaction, creating a regional bank with assets totaling $34 billion. This strategic combination seeks to enhance capabilities in community banking and explore growth opportunities in the California and Hawaiian markets. According to the agreement, the bank will operate under the name Tri Counties Bank, a division of First Hawaiian Bank, in California, while continuing as First Hawaiian Bank in Hawaii.

Under the merger terms, shareholders of TriCo will receive 2.095 shares of First Hawaiian stock for each share of TriCo stock, valuing TriCo at $63.12 per share based on First Hawaiian’s closing price as of July 10. Upon completion of the deal, TriCo shareholders will hold approximately 35% of the merged entity. Both companies' boards have unanimously approved the transaction, which is set to close by the end of 2026, pending necessary regulatory and shareholder approvals.

This merger aligns with First Hawaiian’s strategy to expand its market footprint and leverage TriCo’s strong local presence and leadership in California. Bob Harrison, chairman, president, and CEO of First Hawaiian, highlighted TriCo’s strong deposit franchise and disciplined credit culture as key attributes that complement First Hawaiian’s capabilities. Rick Smith, president and CEO of TriCo, noted that the partnership is based on shared values focused on relationship banking and local decision-making.

TriCo currently ranks 16th by market share in the Central Valley of California, holding a modest 1.2% of the $29.7 billion deposit market, significantly trailing major national and regional competitors like Wells Fargo and Bank of America. The merger aims to strengthen the competitive stance of both banks through combined resources and expanded product offerings, potentially altering market dynamics as the new entity positions itself for growth beyond its current footprint.

The completion of this merger hinges on receiving all requisite approvals and fulfilling standard closing conditions. The integration process will include aligning operational models while maintaining existing branch locations in California. Both banks emphasize their historical commitment to community reinvestment and support, suggesting that this union will create expanded opportunities for regional economic contribution and enhanced customer service offerings.