8-K: Fulton Financial to Acquire Blue Foundry in All-Stock Merger

Fulton Financial Corporation announced an all-stock merger agreement to acquire Blue Foundry Bancorp, expanding its presence in northern New Jersey markets.

Summary

• Fulton Financial Corporation (FULT) will acquire Blue Foundry Bancorp (BLFY) in an all-stock transaction.
• Each share of Blue Foundry common stock will be exchanged for 0.6500 shares of Fulton common stock.
• Based on Fulton's share price of $17.96 as of November 21, 2025, the transaction is valued at approximately $243 million, or $11.67 per share of Blue Foundry common stock.
• The transaction is expected to be accretive to first full-year earnings by over 5%.
• It is expected to be immediately accretive to tangible book value per share and neutral to regulatory capital ratios at close.
• The boards of directors of both Fulton and Blue Foundry have unanimously approved the definitive merger agreement.
• The transaction is expected to close in the second quarter of 2026, subject to customary closing conditions, including regulatory and stockholder approvals.
• Following the closing, Blue Foundry Bank, a wholly owned subsidiary of Blue Foundry, will merge into Fulton Bank, N.A., Fulton's wholly owned bank subsidiary.
• Fulton will make a $1.5 million contribution to the Fulton Forward Foundation, designated for impact grants to nonprofit community organizations in New Jersey.

Sentiment

Score: 8

Explanation: The announcement details a strategic acquisition with strong financial benefits, including immediate tangible book value accretion and significant earnings accretion, without diluting regulatory capital. Management comments are highly positive, emphasizing strategic growth and community benefits. The risks listed are standard for mergers but do not overshadow the stated benefits.

Positives

• Expands Fulton's presence in attractive northern New Jersey markets, aligning with its growth strategy.
• Expected to be accretive to first full-year earnings by over 5%.
• Expected to be immediately accretive to tangible book value per share.
• Expected to be neutral to regulatory capital ratios at close, with a pro forma CET1 of 11.7%.
• No tangible book value earn back period, indicating an efficient capital deployment.
• Creates an opportunity to leverage Fulton's robust banking services and provide greater convenience and innovative solutions to an expanded customer base.
• Positions Fulton well to drive organic growth across its commercial, consumer, wealth advisory, and mortgage businesses.
• Preserves local relationships and personalized service for Blue Foundry customers while providing access to greater resources.
• Fulton will contribute $1.5 million to the Fulton Forward Foundation to support New Jersey community organizations.

Risks

• Revenue or expense synergies and other expected benefits, including anticipated cost savings and strategic gains, may not be realized as expected or at all due to integration challenges, economic factors, or competitive pressures.
• The occurrence of any event, change, or circumstances that could give rise to the right of one or both parties to terminate the Merger Agreement.
• The Proposed Transaction may not be completed when expected or at all if required regulatory, stockholder, or other approvals are not received or satisfied on a timely basis, or if such approvals impose adverse conditions.
• Reputational risks and potential adverse reactions or changes to business or employee relationships resulting from the announcement or completion of the Proposed Transaction.
• Dilution caused by Fulton's issuance of common stock in connection with the Proposed Transaction.
• Diversion of management's attention and time from ongoing business operations and other opportunities.
• The outcome of any legal proceedings related to the Proposed Transaction.
• Unanticipated challenges or delays in the integration of Blue Foundry's business or the conversion of its operating systems and customer data, potentially increasing expenses.
• Continued pressures and uncertainties within the banking industry and markets, including changes in interest rates, price fluctuations, market events, deposit amounts and composition, increased competitive pressures, operational risks, and asset and credit quality deterioration.
• The impact of proposed or imposed tariffs by the U.S. government or retaliatory tariffs by U.S. trading partners that could adversely affect customers.
• Any recession or slowdown in economic growth, particularly in the markets where Fulton or Blue Foundry operate.
• Legislative, regulatory, and fiscal policy changes and related compliance costs.

Future Outlook

The transaction is expected to close in the second quarter of 2026. It is anticipated to be accretive to first full-year earnings by over 5%, immediately accretive to tangible book value per share, and neutral to regulatory capital ratios at closing. The merger aims to accelerate Fulton's growth in northern New Jersey and drive organic growth across its commercial, consumer, wealth advisory, and mortgage businesses.

Management Comments

• "We're bringing together two community-focused banks with shared values and a strong commitment to making banking personal for each and every customer." Curtis J. Myers, Fulton Chairman and CEO.
• "The combination of our companies creates an opportunity to leverage Fulton's robust banking services and provide greater convenience and innovative solutions to an expanded customer base, with a continued focus on supporting our local communities." Curtis J. Myers, Fulton Chairman and CEO.
• "The expansion in northern New Jersey aligns with our strategy of growing in our local markets and positions us well to drive organic growth across our commercial, consumer, wealth advisory and mortgage businesses." Curtis J. Myers, Fulton Chairman and CEO.
• "Joining forces with Fulton is an exciting step forward for our employees, customers and communities." James D. Nesci, President and Chief Executive Officer of Blue Foundry.
• "This partnership allows us to preserve the local relationships and personalized service our customers value, while gaining access to greater resources and providing more solutions and convenience to customers." James D. Nesci, President and Chief Executive Officer of Blue Foundry.
• "Together, we're building a stronger future for everyone we serve." James D. Nesci, President and Chief Executive Officer of Blue Foundry.

Industry Context

This merger represents a strategic consolidation within the regional banking sector, allowing Fulton Financial to expand its footprint into the attractive northern New Jersey market. This move is consistent with a trend of larger regional banks seeking growth opportunities through acquisitions to enhance market share and leverage economies of scale, particularly in competitive and desirable geographic areas. The focus on "community-focused banks" and "personalized service" suggests an attempt to maintain local customer relationships while integrating into a larger financial institution.

Comparison to Industry Standards

• The transaction is expected to be immediately accretive to tangible book value per share with no tangible book value earn back period, which is a strong indicator of financial health and efficient capital deployment compared to many bank mergers that often involve a TBV dilution and a longer earn-back period.
• The projected pro forma CET1 ratio of 11.7% at close indicates a robust capital position for the combined entity, generally above regulatory minimums and competitive within the regional banking sector.
• The expected accretion to first full-year earnings by over 5% is a favorable outcome, suggesting the merger is financially beneficial and well-structured to deliver shareholder value.

Stakeholder Impact

• Shareholders (Fulton): Expected earnings accretion, immediate tangible book value accretion, and strategic growth in new markets. Potential for dilution from stock issuance.
• Shareholders (Blue Foundry): Exchange of shares for Fulton common stock, receiving a premium based on the valuation.
• Employees (Blue Foundry): Integration into a larger organization, potential changes in roles or structure. Management comments suggest a focus on preserving local relationships.
• Customers (Blue Foundry): Access to Fulton's broader range of banking services, greater convenience, and innovative solutions. Continued personalized service.
• Communities (New Jersey): $1.5 million contribution to Fulton Forward Foundation for local nonprofit organizations.

Next Steps

• Obtain required regulatory approvals.
• Obtain approval by Blue Foundry's stockholders.
• Fulton will file a registration statement on Form S-4 with the SEC.
• The definitive proxy statement/prospectus will be sent to Blue Foundry stockholders.
• Closing of the transaction is expected in the second quarter of 2026.
• Following closing, Blue Foundry Bank will merge into Fulton Bank, N.A.

Key Dates

Recommendation

The all-stock merger is strategically sound, expanding Fulton's presence in attractive New Jersey markets. The financial projections are highly favorable, with over 5% earnings accretion in the first full year, immediate tangible book value accretion, and neutral regulatory capital ratios. The absence of a tangible book value earn-back period is particularly positive, indicating a well-structured deal. These factors, combined with the unanimous board approvals and the commitment to community investment, suggest a strong potential for shareholder value creation for Fulton.

Keywords

Fulton Financial Corporation, Blue Foundry Bancorp, Merger, Acquisition, Banking, Financial Services, New Jersey, Community Banking, Stock Transaction, Earnings Accretion, Tangible Book Value, Regulatory Capital, FULT, BLFY