(Reuters) -FirstSun Capital Bancorp ( FSUN ) will buy First Foundation ( FFWM ) in an all-stock deal valued at $785 million, the companies said on Monday, as mergers and acquisitions within regional banks accelerate amid credit concerns in the sector and macroeconomic uncertainties.

Shares of First Foundation were up about 8% in trading after the bell. FirstSun shares were down about 4%.

Bank mergers of similar deal values have taken shape in the second half of 2025, with boardrooms more open to M&As following a slowdown as lenders look to strengthen their balance sheets through consolidation.

Credit worries in the sector connected to lenders such as Zions Bancorp had jolted bank stocks earlier in the month; however, a string of positive results have helped the sector pare losses.

Nicolet Bankshares ( NIC ) is acquiring MidWestOne Financial Group ( MOFG ) for $864 million in stock, in one of the biggest deals of the year, the companies said last week.

First Foundation ( FFWM ) common and preferred stockholders will receive 0.16083 of a share of FirstSun. Following the merger's closing, FirstSun stockholders will own 59.5% of the combined company.

The merger, which is expected to close in the second quarter of 2026, will create a company with total assets of $17 billion and total assets under management of $6.8 billion. It will also help in FirstSun's expansion in the Southern California market.

FirstSun's executive chairman, CEO and CFO will all retain their positions. Tom Shafer, currently the executive chief of First Foundation ( FFWM ), will serve as vice chairman of the combined company.

Stephens is acting as the exclusive financial adviser to FirstSun, while Keefe Bruyette and Woods is acting as the lead adviser to First Foundation ( FFWM ).