MARIETTA, Ohio – September 30, 2026 (STL.News) Peoples Bancorp Inc. has agreed to acquire Capital Bancorp Inc. in an all-stock transaction initially valued at approximately $728.1 million, a deal that would significantly expand Peoples’ geographic footprint and add nationwide credit card, government-guaranteed lending, and mortgage operations to the regional bank’s existing financial-services platform.
Peoples Bancorp, traded on Nasdaq under the symbol PEBO, and Capital Bancorp, traded under CBNK, announced the definitive merger agreement Wednesday after signing it Sept. 29.
Under the agreement, Capital shareholders will receive 1.11 shares of Peoples Bancorp common stock for each Capital share they own. The companies valued the consideration at approximately $43.75 per Capital share based on Peoples’ 20-day volume-weighted average closing price of $39.41 through Sept. 29.
That $43.75 figure should not be interpreted as a guaranteed acquisition price, however. Because Capital shareholders are receiving Peoples Bancorp shares rather than a fixed amount of cash, the market value of the consideration will fluctuate with PEBO’s stock price before the transaction closes.
The companies expect Capital shareholders to own approximately 32% of the combined Peoples Bancorp after the transaction closes.
The merger is expected to close during the first half of 2027, but it is not yet completed. It remains subject to regulatory approvals, approval by shareholders of both companies, and other customary closing conditions.
Peoples Bancorp – Combined bank expected to have about $14 billion in assets
The transaction would create a substantially larger regional financial institution.
Peoples and Capital project the combined organization will have approximately $14 billion in assets, $10 billion in loans and $11 billion in deposits, with more than 150 banking locations across eight states and Washington, D.C.
Peoples Bancorp, headquartered in Marietta, Ohio, reported approximately $9.5 billion in total assets as of June 30. At the time, the company operated 144 locations, including 127 full-service bank branches across Ohio, Kentucky, West Virginia, Virginia, Washington, D.C., and Maryland.
Capital, headquartered in Rockville, Maryland, reported $3.89 billion in consolidated assets as of June 30, according to its quarterly filing with the U.S. Securities and Exchange Commission.
Capital also reported approximately $3.37 billion in deposits at the end of June.
The Maryland company generated net income of $14.25 million in the second quarter, up from $13.14 million in the same quarter of 2025, an increase of about 8.5%.
For the first six months of 2026, Capital reported net income of approximately $26.27 million, compared with $27.07 million during the first half of 2025.
Capital Bancorp adds four distinct financial businesses
The acquisition’s strategic significance extends beyond Capital’s deposits, loans and branch network.
Capital operates four reportable business segments: Commercial Banking, OpenSky, Windsor Advantage and Capital Bank Home Loans.
Its commercial banking operation serves businesses, nonprofit organizations, entrepreneurs, and other customers through markets including Washington, D.C., Baltimore, and other parts of Maryland, along with operations extending into Delaware, Florida, Illinois, and North Carolina.
OpenSky gives Capital a substantially different business from a traditional regional bank. The digitally driven platform provides secured, partially secured, and unsecured credit cards nationwide, including products designed for consumers seeking to establish or rebuild credit.
Capital reported approximately $145 million of OpenSky loans, net of reserves for interest and fees, as of the second quarter, according to company investor materials.
Windsor Advantage provides another source of diversification. The business provides community banks and credit unions with outsourced services involving U.S. Small Business Administration 7(a) and U.S. Department of Agriculture lending.
Capital reported a Windsor Advantage servicing portfolio of approximately $3.4 billion for the second quarter of 2026.
Capital Bank Home Loans, meanwhile, originates residential mortgages primarily for sale into the secondary market.
Those operations mean Peoples is acquiring more than a conventional Maryland banking franchise. If successfully integrated, Capital would give Peoples additional fee-producing and nationwide businesses that are not dependent solely on the combined company’s physical branch network.
Peoples is already completing another acquisition
The Capital transaction also comes during an unusually active period of expansion for Peoples.
In April, Peoples announced a separate agreement to acquire Citizens National Corporation, the Paintsville, Kentucky-based parent of Citizens Bank of Kentucky.
That transaction was initially valued at approximately $76.6 million based on Peoples’ stock price when the agreement was announced.
Citizens shareholders are to receive 2.10 Peoples shares plus $8 in cash for each Citizens share.
On Sept. 28 — only two days before Peoples and Capital publicly announced their merger — Peoples said it had received all necessary regulatory approvals for the Citizens transaction.
Citizens shareholders had already approved that merger on Aug. 6.
The Federal Reserve also announced approval of Peoples’ application associated with the Citizens acquisition in September.
Citizens Bank operates 12 branches primarily in eastern Kentucky and had approximately $700 million in assets when Peoples announced the transaction.
Taken together, the Citizens and Capital agreements represent a substantial expansion of Peoples in a relatively short period.
Peoples moves well beyond $10 billion in assets
The Capital acquisition would also fundamentally change Peoples’ size from a regulatory perspective.
Peoples had approximately $9.5 billion in assets at June 30 and had previously discussed managing its balance sheet around the $10 billion asset level.
When Peoples Bancorp announced the Citizens transaction in April, President and CEO Tyler Wilcox specifically cited Citizens’ deposits and liquidity as giving Peoples flexibility to remain below $10 billion in assets.
The Capital transaction changes that trajectory.
Rather than hovering around the threshold, the proposed combination is expected to produce a company with approximately $14 billion in assets.
Crossing $10 billion has historically been an important milestone in U.S. banking because certain regulatory, compliance, and supervisory requirements apply differently as financial institutions grow.
The larger asset and revenue base contemplated in the Capital transaction could give Peoples more scale to spread technology, compliance, risk-management, and other operating expenses. At the same time, a larger and more complex organization creates additional integration and execution responsibilities.
Peoples Bancorp projects earnings benefits from the transaction
Peoples and Capital are presenting the merger as financially beneficial to the combined organization, although those projections remain forward-looking estimates rather than guaranteed results.
The companies expect the transaction to be immediately accretive to Peoples’ estimated 2027 earnings, excluding one-time merger-related expenses.
They also project a tangible book value earnback period of less than three years and an approximately 20% pro forma return on average tangible common equity.
Actual results could differ because of integration costs, credit performance, interest rates, economic conditions, changes in deposits, regulatory requirements and other factors.
Peoples reported net income of $28 million for the second quarter of 2026, or 78 cents per diluted common share. That compared with $21.2 million, or 59 cents per diluted share, during the second quarter of 2025.
The company reported a second-quarter net interest margin of 4.23%, up from 4.16% in the preceding quarter.
Peoples Bancorp – Capital shareholders would own about 32% of Peoples
Capital’s ownership position following the merger is considerably larger than in a typical branch or small community-bank acquisition.
Capital shareholders are expected to own approximately 32% of Peoples after the transaction closes.
Existing Peoples Bancorp shareholders would therefore see their ownership percentage diluted as Peoples issues new shares to Capital shareholders.
The merger agreement also provides for the selection and appointment of three Capital directors to the Peoples board immediately after the transaction becomes effective, subject to Peoples’ corporate governance policies and director evaluation procedures.
Capital’s directors and executive officers entered into support agreements under which they agreed, subject to the agreements’ terms, to vote their Capital shares in favor of the transaction.
Both companies’ boards unanimously approved the merger agreement.
Peoples Bancorp – $30.66 million termination fee included in agreement
The SEC filing provides additional details beyond the companies’ initial public announcement.
Capital could be required to pay Peoples a $30.66 million termination fee if the merger agreement ends under certain specified circumstances.
Those circumstances include provisions related to certain competing acquisition proposals, a change in Capital’s board recommendation, or specified violations of the agreement’s restrictions on soliciting competing transactions.
The agreement nevertheless contains customary provisions allowing Capital’s board, under specified circumstances, to consider an unsolicited acquisition proposal that it determines in good faith could reasonably be expected to result in a superior proposal.
The merger agreement can also be terminated under other circumstances, including mutual agreement, failure to receive required shareholder approvals, a final regulatory denial, or failure to complete the transaction by the agreement’s one-year anniversary, subject to the specific conditions contained in the contract.
Peoples Bancorp – Regulatory and shareholder approvals remain
Despite the companies’ agreement, several significant steps remain before the acquisition can close.
Capital shareholders must approve and adopt the merger agreement. Peoples shareholders must also approve matters required to complete the transaction, including issuing Peoples shares as merger consideration.
The companies must receive required regulatory approvals and applicable waiting periods must expire.
Peoples also intends to file a Form S-4 registration statement with the SEC covering the shares that would be issued to Capital shareholders. That registration statement is expected to contain a joint proxy statement and prospectus providing shareholders with considerably more information about the proposed combination.
The Peoples shares issued in the merger also must be approved for listing on the Nasdaq Global Select Market.
The transaction is intended to qualify as a reorganization under Section 368(a) of the Internal Revenue Code.
After the holding-company merger is completed, Capital Bank, N.A. is expected to merge into Peoples Bank, with Peoples Bank surviving.
Peoples Bancorp – Advisers named for $728 million transaction
Raymond James & Associates Inc. is serving as financial adviser to Peoples, while Dinsmore & Shohl LLP is serving as its legal counsel.
Stephens Inc. is serving as financial adviser to Capital, with Squire Patton Boggs LLP acting as Capital’s legal counsel.
The transaction’s initial valuation of approximately $728.1 million makes it substantially larger than Peoples’ pending Citizens National acquisition and represents a significant strategic move for the Ohio-based financial institution.
If completed on the terms announced, Peoples would emerge with a considerably larger Mid-Atlantic presence, a balance sheet well above $10 billion and additional nationwide businesses spanning consumer credit cards, SBA and USDA loan servicing, residential mortgage banking and commercial banking.
The acquisition nevertheless remains subject to the risks common to large bank combinations, including obtaining regulatory and shareholder approvals, successfully integrating the organizations, retaining customers and employees, managing credit quality and achieving anticipated cost and revenue benefits.
Because the consideration is entirely stock-based, Capital shareholders also remain exposed to changes in Peoples’ share price. The announced $43.75-per-share value is based on the historical PEBO price specified by the companies and will not necessarily represent the value of the Peoples shares Capital investors ultimately receive.
As of Sept. 30, the transaction remains a proposed merger under a signed definitive agreement, not a completed acquisition.
No court has ruled on the fairness of the transaction, and the financial projections associated with the merger are management estimates and forward-looking statements that could differ materially from actual results.
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