First Financial Bank has reached an agreement to acquire BankFinancial, a Chicago-based financial institution, in an all-stock transaction valued at approximately $142m.

Under the terms of the agreement, shareholders of BankFinancial will receive 0.48 shares of First Financial for each share they hold. The boards of directors for both banks have unanimously approved the merger.

This acquisition will allow First Financial to expand its operations in the Chicagoland area, where BankFinancial operates 18 financial centres.

BankFinancial has  more than  100 years of experience in commercial lending and offers a range of financial solutions to businesses and individuals in the greater Chicago region.

Following the completion of the acquisition, BankFinancial’s consumer and wealth management services, along with selected commercial credit lines, will be integrated into First Financial’s existing operations.

All employees of BankFinancial will transition to First Financial.

BankFinancial chairman, president and CEO Morgan Gasior said: “First Financial is the ideal choice to help us continue our legacy of delivering exceptional financial solutions, while maintaining a strong commitment to customer care and service to our communities.”

This acquisition follows First Financial’s recent growth initiatives, including a prior agreement to acquire Westfield Bank in Northeast Ohio and its ongoing expansion into Chicago, Cleveland, and Grand Rapids.

First Financial president and CEO Archie Brown said: “The addition of BankFinancial’s retail financial centers enables us to continue our Midwest growth strategy and provides Chicago clients a broader range of banking and specialty solutions to help them meet their financial goals.”

The transaction is anticipated to close in the fourth quarter of 2025, pending regulatory approvals and the consent of BankFinancial shareholders.

Morgan Stanley is advising First Financial on the financial aspects of the deal, while Keefe, Bruyette & Woods, A Stifel Company, is providing similar services for BankFinancial.

Legal counsel for First Financial is being provided by Squire Patton Boggs, while Kirkland & Ellis and Luse Gorman are advising BankFinancial.

First Financial Bancorp, headquartered in Cincinnati, Ohio, reported assets of $18.6bn, loans of $11.8bn, and deposits of $14.4bn as of 30 June 2025.

The company operates 128 full-service banking centres across Ohio, Indiana, Kentucky, and Illinois.