Peoples Bancorp has agreed to purchase Capital Bancorp in an all-stock transaction valued at $728 million, marking a significant expansion into the Washington, D.C., metropolitan area. The merger, revealed on Wednesday, will unite the two financial institutions under Peoples’ leadership, creating a combined entity with projected total assets of $14 billion, loans exceeding $10 billion, and deposits totaling $11 billion. The acquisition encompasses more than 150 banking locations spread across eight states and Washington, D.C.
The decision to acquire Capital was driven by several strategic elements, including its commercial banking operations, the OpenSky credit card designed for credit improvement, and its Small Business Administration-backed lending platform. Peoples also cited Capital’s home loan division as a key asset that will integrate smoothly with its existing portfolio.
Capital shareholders will receive 1.11 shares of Peoples stock for each share they own, based on a valuation of $43.75 per share. This figure reflects Peoples’ 20-day average stock price of $39.41. The transaction is scheduled to finalize in the first half of 2027 and is expected to deliver immediate profitability for Peoples, even before accounting for transitional costs.
This acquisition represents Peoples’ second major deal in 2026. Earlier this year, the bank announced plans to acquire Citizens Bank of Kentucky, though it later divested the lender’s $300 million securities portfolio to avoid surpassing the $10 billion asset threshold. Crossing that limit would have subjected the bank to stricter regulatory scrutiny. Peoples has indicated it remains willing to exceed this threshold if the right opportunities emerge.
Tyler Wilcox, CEO of Peoples Bancorp, emphasized that the acquisition goes beyond simple expansion, reinforcing the bank’s competitive position. The merger will also bring three Capital board members onto Peoples’ board following the deal’s completion.
During an investor call, Wilcox reiterated the bank’s openness to future acquisitions, describing its strategy as disciplined and responsive to market conditions. The move follows a period of steady growth for Peoples, which has invested in upgrading systems and infrastructure to accommodate larger transactions.