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HMN FINANCIAL, INC.
101 North Broadway
Spring Valley, MN 55975
Phone 507-346-7345
Fax 507-346-1111
NEWS RELEASE CONTACT: James B. Gardner,
Executive Vice President
HMN Financial, Inc. (507) 346-7345
FOR IMMEDIATE RELEASE
HMN FINANCIAL, INC. ANNOUNCES COMPLETION OF MERGER WITH
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MARSHALLTOWN FINANCIAL CORPORATION
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SPRING VALLEY, MINNESOTA, December 8, 1997 . . . HMN
Financial, Inc. (HMN) (NASDAQ:HMNF), the thrift holding company
for Home Federal Savings Bank (the Bank), and Marshalltown
Financial Corporation (MFC) (NASDAQ:MFCX), the thrift holding
company for Marshalltown Savings Bank, FSB, have completed their
merger. MFC was merged into Home Federal Savings Bank and will
be operated as a branch of the Bank. The aggregate merger
consideration was $24.8 million, consisting of $23.7 million for
the 1.35 million outstanding MFC shares, or $17.51 per MFC share,
and $1.1 million for the outstanding MFC options. HMN owned
60,000 shares of MFC, which were cancelled under the merger
agreement. The merger is being accounted for as a purchase
transaction.
"The merger consideration is all cash and therefore utilizes
Home Federal's excess capital to increase the assets and
liabilities of the Bank," said HMN Chairman and Chief Executive
Officer Roger P. Weise. "The geographic expansion of the Bank
out of southern Minnesota into Iowa will allow the Bank to
service new markets and also increase its customer base."
Letter of transmittal forms will be mailed by Registrar and
Transfer Company, the exchange agent, to MFC shareholders on
December 10, 1997. The transmittal forms must be returned to the
exchange agent within 180 days of December 5, 1997. All
questions with respect to the surrender of certificate(s) of MFC
common stock should be made directly to the Registrar and
Transfer Company at 1-800-368-5948, extension 7760.
On July 1, 1997, HMN and MFC announced an Agreement and Plan
of Merger (the Agreement). On November 7, 1997, HMN and MFC
announced MFC's shareholder approval of the Agreement. On
November 18, 1997 HMN received approval from the Office of Thrift
Supervision to close the Agreement.
At September 30, 1997, MFC had total assets of $125.5
million, deposits of $103.7 million and shareholders' equity of
$20.3 million.
HMN Financial, Inc. and Home Federal Savings Bank are
headquartered in Spring Valley, MN. Home Federal Savings Bank
operates seven offices in southern Minnesota and a mortgage
banking office in Eden Prairie, Minnesota. As a result of the
merger it now operates two full service retail banking facilities
in Marshalltown and Toledo, Iowa.
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