Heartland Financial USA has agreed to acquire Signature Bancshares, the parent company of Signature Bank, in Minnesota in a cash and stock transaction valued at $53.4m.

As of 30 September 2017, Signature Bank had around $390m in total assets, $326m in net loans outstanding and $339m in deposits.

Under the agreement, shareholders of Signature will receive 0.0610 shares of Heartland common stock and $0.335 in cash per each share exchanged.

Following the acquisition, Signature Bank will merge with and into Minnesota Bank & Trust, Minnesota-based subsidiary of Heartland.

The combined entity will have more than $600m in total assets and will operate under the brand of Minnesota Bank & Trust.

In addition, the acquirer has appointed Ken Brooks as the president and CEO of Minnesota banking operations.

The deal has been approved by the board of directors of both companies and is expected to complete in the first quarter of 2018.

“The combination of Signature Bank with the Heartland family of community banks significantly increases our lending capabilities and gives us access to products and services offered by larger banks while preserving our legacy as a locally-led community bank,” Brooks said.