Heartland Financial USA, Inc. based in Dubuque, announced today that is has acquired all deposits of The Elizabeth State Bank in Elizabeth, Ill. through its subsidiary Galena State Bank based in Galena, Ill. in a loss-share transaction facilitated by the Federal Deposit Insurance Corporation (FDIC).

“Customers can be assured that their deposits are safe and remain readily accessible,” said Lynn B. Fuller, president and CEO of Heartland Financial. “Our banks have been well-capitalized and continue to exceed all regulatory capital requirements.”

Bank branches previously owned and operated by Elizabeth State Bank will reopen on Monday, July 6, 2009 as Galena State Bank branches. Customers of Elizabeth State Bank should continue to bank as usual at their Elizabeth and Galena branches.

“Galena State Bank employees look forward to serving the banking needs of Elizabeth State Bank customers to make great things happen,” Fuller said.

As of April 30, 2009, The Elizabeth State Bank had loans of approximately $43 million and total deposits of approximately $48 million. Galena State Bank and Trust paid a premium of 1.0 percent to acquire all of the deposits of the failed bank. In addition to assuming all of the deposits of the failed bank, Galena State Bank and Trust agreed to purchase approximately $52.3 million of assets. The FDIC will retain the remaining assets for later disposition.

Galena State Bank and Trust will share in the losses on the asset pools covered under the loss-share agreement. The loss-sharing arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers.

Customers who have questions about today’s transaction can call the FDIC toll-free at 1-800-591-2820. The phone number will be operational this evening until 9:00 p.m., Central Daylight Time (CDT); on Friday and Saturday from 9:00 a.m. to 6:00 p.m., CDT; on Sunday from noon to 6:00 p.m., CDT; and thereafter from 8:00 a.m. to 8:00 p.m., CDT. Interested parties can also visit the FDIC’s Web site.

Heartland Financial USA, Inc. is a $3.7 billion diversified financial services company providing banking, mortgage, wealth management, insurance and consumer finance services to individuals and businesses. The company has now has 63 banking locations in 42 communities in Iowa, Illinois, Minnesota, Wisconsin, New Mexico, Arizona, Montana and Colorado. Additional information about Heartland Financial USA, Inc. is available at www.htlf.com.