Mergers and acquisitions:

FNB Financial Corp. merger

On September 17, 2019, the Company entered into a definitive agreement to acquire FNB Financial Corp. and its wholly owned subsidiary, Farmers National Bank of Scottsville (collectively, "Farmers National"). Farmers National has five branches and reported total assets of $251,216, loans of $174,850 and deposits of $201,909 as of September 30, 2019. The Company expects to issue 954,827 shares of FBK common stock as consideration in connection with the merger, in addition to approximately $15,000 in cash consideration. The market value of the stock consideration will fluctuate with the market price of the Company's common stock and will not be known until the merger is consummated. Based on the closing price of the Company's common stock on the New York Stock Exchange of $38.26 on September 17, 2019, the merger consideration represented approximately $51,900 in aggregate consideration. The acquisition is expected to close in the first quarter of 2020 and is subject to regulatory approvals, approval by FNB Financial Corp. shareholders and other customary closing conditions.

Upon consummation, Farmers National will be merged with and into FB Financial. The Farmers National merger will be accounted for under FASB ASC Topic 805, "Business Combinations."

Atlantic Capital Bank branch acquisition

On April 5, 2019, the Bank completed its previously-announced branch acquisition to purchase 11 Tennessee and three Georgia branch locations (the "Branches") from Atlantic Capital Bank, N.A., a national banking association and a wholly owned subsidiary of Atlantic Capital Bancshares, Inc. (collectively, “Atlantic Capital”) in a transaction valued at $36,790, further increasing market share in existing markets and expanding the Company's footprint into new locations. Upon consummation, the Branches were merged with and into FirstBank, consolidating three of the purchased branches across the existing bank footprint. Under the terms of the agreement, the Bank assumed $588,877 in deposits for a premium of 6.25% and acquired $374,966 in loans at 99.32% of principal outstanding.

The acquisition of the Branches was accounted for in accordance with ASC Topic "Business Combinations." Accordingly, the assets and liabilities, both tangible and intangible, were recorded at their estimated fair values as of the acquisition date. The Company is finalizing the fair value of acquired assets and liabilities assumed and as such, purchase accounting is not yet complete.

Goodwill of $31,396 recorded in connection with the transaction resulted from the ongoing business contribution of the Branches.

The Company incurred $199 and $4,614 in merger expenses during the three and nine months ended September 30, 2019, respectively, in connection with this transaction. These expenses are primarily comprised of professional services and employee-related costs in addition to branch closings and conversion and integration costs.

The following tables present the preliminary fair values of assets acquired and liabilities assumed as of the April 5, 2019 acquisition date and an allocation of the consideration to net assets acquired:



	As of April 5, 2019
	As Recorded by FB Financial Corporation⁽¹⁾
Assets
Cash and cash equivalents⁽¹⁾	$	207,822
Loans, net of fair value adjustments	374,966
Premises and equipment	9,650
Operating lease right-of-use assets	4,133
Core deposit intangible	10,760
Accrued interest and other assets	1,271
Total assets	$	608,602
Liabilities
Deposits
Noninterest-bearing	$	118,405
Interest-bearing checking	112,225
Money markey and savings	211,135
Customer time deposits	147,112
Total deposits	588,877
Customer repurchase agreements	9,572
Operating lease liabilities	4,133
Accrued expenses and other liabilities	626
Total liabilities	603,208
Total net assets acquired	$	5,394

(1) Cash and cash equivalents were reduced in settlement by the deposit premium paid of $36,790 to reflect net cash received of $171,032.



Consideration:
Deposit premium	$	36,790
Preliminary allocation of consideration:
Fair value of net assets acquired	$	5,394
Goodwill (preliminary)	31,396
Total consideration	$	36,790

The following table presents the fair value of acquired purchased credit impaired loans accounted for in accordance with ASC 310-30 "Loans and Debt Securities Acquired with Deteriorated Credit Quality" from the Atlantic Capital branch acquisition as of the acquisition date:



	April 5, 2019
Contractually-required principal and interest	$	11,374
Nonaccretable difference	1,615
Best estimate of contractual cash flows expected to be collected	9,759
Accretable yield	1,167
Fair value	$	8,592

The following unaudited pro forma condensed consolidated financial information presents the results of operations for the three and nine months ended September 30, 2019 and 2018 as though the merger had been completed as of January 1, 2018. The unaudited estimated pro forma information combines the historical results of the Branches with the Company’s historical consolidated results and includes certain adjustments reflecting the estimated impact of certain fair value adjustments for the periods presented. Merger expenses are reflected in the periods they were incurred. The pro forma information is not indicative of what would have occurred had the acquisition taken place on January 1, 2018 and does not include the effect of all cost-saving or revenue-enhancing strategies.



	Three months ended September 30,				Nine months ended September 30,
	2019		2018		2019		2018
Net interest income	$	58,305	$	56,522	$	171,915	$	165,209
Total revenues	$	96,450	$	91,688	$	272,868	$	271,099
Net income	$	23,966	$	20,283	$	59,745	$	60,680

Due to the timing of the data conversion and the integration of operations of the Branches onto the Company's existing operations, historical reporting of the acquired Branches is impracticable, and therefore, disclosure of the amounts of revenue and expenses from the acquired Branches since the acquisition date are not available.