Bank of Granite of Catawba County and CommunityOne Bank of Asheboro, which both have struggled with bad loans in recent years, announced Wednesday they plan to merge.

The deal comes with a badly needed cash infusion from new investors. Oak Hill Capital Partners and The Carlyle Group plan to invest a total of $155 million. The merger still needs shareholder and regulatory approval, but could close in the third quarter of this year, the banks said.

CommunityOne is operated by FNB United, and that would be the name of the combined company. Headquarters would be in Asheboro, and would have $2.9 billion in assets, $2.4 billion in deposits and 63 branches around the state, including the Lake Norman area.

CommunityOne and Bank of Granite would operate separately until an unnamed future date. Eventually, the bank plans to convert all the branches to the CommunityOne name.

With the merger, the bank would have new management: chief executive Brian Simpson, a one-time First Union executive, and President Bob Reid, a former executive at First Union and Wachovia. A new board also is to be appointed.

“The past few years have presented FNB United with significant challenges, and through this proposed merger we will embrace a new way forward from a position of strength,” Jim Campbell, chairman of FNB United, said in a press release Wednesday morning.

John Bray, his counterpart at Bank of Granite, said, “Bank of Granite and CommunityOne share many synergies, including the top priority of providing excellent and reliable banking services to our local communities. Both institutions have enjoyed great successes and weathered challenging times for more than a century, and the announcements today will help position both companies for the future.”

RELATED LINKS

April 27, 2011, Charlotte Business Journal, “Bank of Granite, CommunityOne to merge” – Finance editor Adam O’Daniel writes about the deal.

April 27, 2011, Bank of Granite/CommunityOne press release.

CommunityOne website

Bank of Granite website.