Arrow Financial to Acquire Adirondack Bancorp for $89.1 Million, Boost Assets to $5.4 Billion
Arrow Financial Corporation will merge with Adirondack Bancorp, extending its footprint into Oneida, Herkimer and Franklin counties and creating a pro-forma company with $5.4 billion in assets, $4.8 billion in deposits and $4.1 billion in loans. Shareholders receive 1.8610 Arrow shares plus $18.72 cash per Adirondack share.
1. Merger Agreement and Strategic Rationale
Arrow Financial Corporation and Adirondack Bancorp have unanimously approved a merger agreement under which Adirondack will merge into Arrow, extending Arrow’s eight-county footprint into Oneida, Herkimer and Franklin counties and reinforcing presence in Essex and Clinton counties. The combined institution will leverage complementary product offerings, including wealth management and insurance services currently held by Arrow.
2. Pro-forma Financial Profile
Based on December 31, 2025 results, the merged company would report $5.4 billion in total assets, $4.8 billion in deposits and $4.1 billion in loans. Adirondack brings $942 million in assets, $848 million in deposits and $624 million in loans across 19 branches and a loan production office.
3. Transaction Consideration
Adirondack shareholders will receive 1.8610 shares of Arrow common stock and $18.72 in cash per share, implying $82.79 per share and an aggregate transaction value of approximately $89.1 million. Closing is expected by the end of the second quarter of 2026 pending regulatory and shareholder approvals.
4. Expected Financial Impact and Timeline
The deal is projected to deliver approximately 18% EPS accretion in 2027, a 20% internal rate of return, and a tangible book value earn-back period of 2.9 years. At closing, allowance coverage is anticipated above 1.00%, tangible common equity around 8% and total risk-based capital near 14%.